2006 (3) TMI 25

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....ndents in this appeal are engaged in the manufacture of excisable goods and are availing Cenvat credit on inputs and capital goods. 2. They had taken Modvat credit of Rs. 2,16,836/- on capital goods, which was disallowed by the original authority as per order dated 10-12-1998, where after the credit was expunged (when called upon to do so by the Range Superintendent) partly by debit in RG 23C Part II (Rs. 1,25,000/-) and partly by debit in PLA (Rs. 91,836/-), both on 17-4-2000 and under protest. Subsequently order-in-original dated 10-12-1998 was taken in appeal to the Commissioner (Appeals), and the appeal was allowed with consequential relief as per order-in- appeal dated 29-4-2003. The assessee filed a refund claim for Rs. 2,16,836/- wi....

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....peal with the Commissioner (Appeals) against order-in-original dated 10-12-1998 and therefore it should be treated as a "predeposit" and consequently the bar of unjust enrichment would not be applicable to the claim for refund of the amount so pre-deposited. Secondly, ld. Counsel has argued, the amount expunged on 17-4-2000 being the credit of duty paid on excisable goods used as capital goods, the claim for its refund would attract clause (c) of the proviso to Section 11B (2) ibid. It has been argued that, though there is no mention of capital goods in this provision, which refers to inputs, going by legislative intent, One could discern that the provision would be equally applicable to refund of credit of duty on excisable goods used as ....

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....en utilised for payment of duty on final product, cash refund of such duty can be claimed, provided the incidence of such duty is not been passed on to any other person. Such a situation is normally covered by clause (d) of the above proviso. The case law cited by Id. Counsel is not a precedent for the present case inasmuch as, on the aspect of utilisation of Modvat credit, the cited decision is sub silentio. Reverting to the facts of the present case, capital goods credit to the extent of Rs. 91,836/- had been utilised for payment of duty on final product as evidenced by the fact that, when called upon to expunge that credit, the assessee paid the amount from PLA. Burden of duty to this extent was passed on to the buyer of the final produc....