TaxTMI 
TaxTMI 
2010 (8) TMI 727
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....uring the period from 29-9-86 to 27-9-93, pursuant to the pronouncement of decision by the Apex Court on 28-3-1995 [1995 (77) E.L.T. 8 (S.C.)] in the matter of Fenner India Limited classifying such goods under sub-heading No. 3922.90 for a certain period and thereafter under sub-heading 3926.92 of the Central Excise Tariff Act, 1985 attracting low rate of duty then what was actually paid by the appellants. Pursuant to the claim for refund, a show cause notice dated 16-3-1998 was issued requiring the appellants to satisfy against rejection of the refund on the ground of bar of limitation, failure to produce relevant documents as required under Rule 233B of the Central Excise Rules, 1944 in support of their claim about payment of duty under protest, and on the ground of unjust enrichment. 4. The notice was contested by the appellants. However, the adjudicating authority by the order dated 11-7-2001 rejected the claim for refund and appeal against the same was also dismissed by the Commissioner (Appeals) and hence the present appeal. 5. The impugned order is sought to be challenged on four grounds. Firstly, that the final product cleared by the appellants was non-excisable....
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.... the authority below had held that the claim of the appellants was within the period of limitation, it would apparently disclose that the authority was convinced about the factual aspect of the matter in relation to the payment of duty by the appellants and bearing in mind the same and coupled with the fact that the goods in question were non-consumable and the final product non-excisable, the authorities below ought to have held that the appellants had established their case about non-passing of burden of the duty on the consumers of the final product. In support of the contention that in case of capital goods, the doctrine of unjust enrichment would not be attracted inasmuch as that there would be no occasion for the assessee to pass on the burden of duty paid on the capital goods to the consumers of the final product in view of the fact that such goods are not consumed in the final product, the learned Advocate placed reliance in the decision of Madras High Court in the matter of Collector of Custom, Madras v. Indo-Swiss Synthetic Gem Mfg. Co. Ltd. reported in 2003 (162) E.L.T. 121 (Mad.), of the order of the Tribunal in the matter of Toyo Engineering India Ltd. v. Commissioner ....
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....f the provisions of law comprised under Section 11B of the Central Excise Act, 1944. He further submitted that the records do not disclose the said findings to be perverse or de hors the record. Drawing our attention to the specific findings against the appellants by the original authority as well as by the lower appellate authority, the DR submitted that there is no case for interference in the impugned order. 8. The points which arise for consideration are :- (i) Whether in case of duty paid on capital goods, the principles of unjust enrichment would not be attracted while deciding the refund claim in relation to such duty amount? (ii) Whether the price fixation in relation to different grades of coal under Notification dated 8-1-1986 discloses non-inclusion of duty element in such prices? (iii) Whether the capital goods being non-consumable in the final product, the duty element in relation to such capital goods cannot form part of the cost of the final product? (iv) Whether the appellants had suffered loss and the same discloses non-passing of burden of duty upon the consumers of the final product....
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....n capital goods has been passed on to the buyers of the final product or not. Even in case of some of the inputs which may not ultimately be present in the final product when it is ready for clearance, yet the duty paid on such inputs, credit thereof can be availed and utilized by the manufacturer, as also in case it is found that duty on such inputs was wrongly paid, nothing prevents the assessee from claiming refund thereof Being so, the presence of input or capital goods in the final product on its clearance is not the decisive factor to decide whether the duty wrongly paid on capital goods can be refunded ignoring the principle of unjust enrichment. 13. Besides, whether the duty element in relation to the capital goods form part of the sale price of the final product or not is essentially a question of fact which is to be decided on the basis of materials placed on record by the assessee in relation to the factors which the assessee considers while fixing the sale price of the final product. Undoubtedly, the burden in that regard would be on the assessee to establish that the duty paid on the capital goods did not form part of the final product and in case it forms part o....
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....t discloses inclusion thereof. The notification merely discloses various prices with reference to grade specification. Learned Advocate for the appellants, however, has also drawn our attention to the costing factors which were considered in relation to the Coal Study 1992. The said list relates to the information which was required to be collected by the nodal Officers from the headquarter and area offices of the appellants-company regarding various items. The said list also refers to the aspect of depreciation of the various machines which are used in the coal operation as well as in coal handling plant. Presumption, if at all, which could be drawn from the said document would be that the (Government while fixing the price of the coal had taken into consideration various aspects including the depreciation of the machinery used in relation to the coal mining and coal handling operation. Undisputedly, the goods in question namely, conveyor belt is used for transportation of the coal to various places. The said list nowhere discloses the duty element had been ignored while fixing the sale price of the coal of different grades. In the background of these factors, it is difficult to a....
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....Act and consignments were cleared on payment of duty as was demanded. The assessee thereafter filed refund claim on the ground that the silica crucibles were liable to the duty under Heading 69.03 of the Customs Tariff Act, 1975 and no additional duty was leviable under Item 23 since Heading 69.03 covered crucibles and goods were not glassware and hence were not liable to additional duty under item 23. The claim of the assessee was rejected and the matter was carried in writ jurisdiction. During the pendency of the writ jurisdiction, the provision of law underwent certain changes and taking into consideration the changes brought in, the department contended before the Madras High Court that in view of the changes brought in law, the assessee had to file application before the Assistant Collector of Customs for considering the question as to whether the claim was barred by limitation, whether the incidence of duties was passed on to anyone in the course of the trade or not and whether the disputed duty had been paid under protest or not. In response, the assessee clarified under an affidavit that the silica crucibles were used in manufacture of synthetic gems as refractory goods, wh....
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....e details disclosed regarding the function of the crucibles, it was revealed that the crucibles were not consumed in the manufacture of synthetic gem. Further, it is observed in para 29 that. "To put it otherwise, the duty of customs paid on such imported crucibles does not become a part of the manufacture of the new item, viz synthetic gem, in which the imported item, that is to say, silica crucibles, is an ingredient". In other words, the conclusion that the duty paid on the silica crucibles did not form part of the final product has been arrived at on the basis that the silica crucibles were absent as an ingredient of the final product as well as did not form part of the manufacturing process and not because the duty formed part of the sale price of the final product or not. In fact, para 29 makes it more clear that the High Court was essentially dealing with the aspect as to whether silica crucibles formed part of final product in the sense it was an ingredient in the final product and not whether duty paid on the silica crucibles were forming part of the-sale price of the final product or not. 21. In any case, the Larger bench of the Tribunal in SRF Limited case has clea....