AI Drafter 
TaxTMI 
TaxTMI 
2018 (7) TMI 854
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.... payment of Central Excise duty during the period from January 2002 to November 2006 which was allowed by the Commissioner (Appeal) Pune - I vide his order P- 1/168/2008 dated 25.08.2008. At the time of examination of the refund claim Appellant were asked to submit the details of the accounting treatment of the said amount in their books of account. The appellant intimated that the said amount was treated as expenditure in their profit and loss account for the relevant period. After issuing a notice, the adjudicating authority has allowed the refund claim of the party but has credited the same to consumer welfare fund. In Appeal Commissioner (Appeal) has upheld the order of adjudicating authority, 3.0 Arguing for the Appellant, Shri Mayur Shroff (Advocate) submitted: i. The refund claimed by them is not of the duty but of the amounts of deposited by them during the course of investigation. Hence when the matter has been disposed of in their favour by the Commissioner (Appeal), the amounts deposited should be automatically refunded to them without treating them as a refund under section 11B of the Central Excise Act, 1944, in view of the decisions of various authorities, namel....
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....on 11B it has been specifically provided that irrespective of any decision of a court or an appellate authority, no refund shall be granted contrary to the provisions of section 11B. iii. Appellant has not been able to negate the statutory presumption to effect of passing on the burden of the amount paid on to the consumer. iv. Since the amount claimed as refund has been shown on the expenditure side in Profit and Loss Account of the Appellant the same has been recovered from the customer and hence the refund claim though sanctioned has been rightly credited to the consumer welfare fund. 5.0 Have considered the submissions made by both the sides. 6.1 Main thrust of the arguments advanced by the Appellant, is to effect that the amounts deposited by them were only in nature of deposits and not duty and hence the refund of the said amount should be not be governed by the said section 11B and doctrine of unjust enrichment should not apply in their case. It is also an admitted fact that Appellant has claimed the deduction of the amount claimed as refund by them as expense in his profit and loss account, i.e. as a deduction under section 43B of the Income Tax Act, 1961 6.2....
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.... After considering the submissions their Lordships concluded that the nature of deposits made in PLA too are also Central Excise duty for the purpose of Section 43B of the Income Tax Act, 1961. The relevant paras of the decision are reproduced below: "3. The question involved in all the appeals is the same and may be formulated as hereunder: "Whether the assessee is entitled to claim deduction under Section 43B of the Income Tax Act, 1961 in respect of the excise duty paid in advance in the Personal Ledger Account ("PLA" for short)?" 12. The above discussions, coupled with the peculiar features of the case, noticed above i.e. consistent practice followed by the assessee and accepted by the Revenue; the decisions of the two High Courts in favour of the assessee which have attained finality in law; and no contrary view of any other High Court being brought to our notice, should lead us to the conclusion that the High Courts were justified in taking the view that the advance deposit of central excise duty constitutes actual payment of duty within the meaning of Section 43B of the Central Excise Act and, therefore, the assessee is entitled to the benefit of d....
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....he incidence of duty and interest, if any, paid on such duty has not been passed on by the persons concerned to any other person." 6.5 Accordingly all the amounts deposited other than those deposited as per the specific direction of the court or appellate authority in terms of Section 35 F are nothing but the payment towards the duty and all the claims of the refund of such amount shall be governed by the provisions of Section 11B of the Central Excise Act, 1944. Hon'ble Supreme Court has in case of Mafatlal Industries Ltd. [1997 (89) ELT 247 (SC)] observed in the para 99 as under :- "By virtue of sub-section (3) to Section 11B of the Central Excise and Salt Act as amended by the aforesaid Amendment Act, and by virtue of the provisions contained in sub-section (3) of Section 27 of the Customs Act, 1962 as amended by the said Amendment Act, all claims for refund (excepting those which arise as a result of declaration of unconstitutionality of a provision whereunder the levy was created) have to be preferred and adjudicated only under the provisions of the respective enactment. No suit for refund of duty is maintainable in that behalf. So far as the jurisdiction of the Hi....
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....rly make the pre-deposit distinguishable from payment of duty. Para 5.2 of the CBEC Circular states that "Pre-deposit for filing appeal is not payment of duty." In the present case when in terms of the Apex Court decision the deposits made were towards the payment of the duty the argument made by the Appellant to give similar treatment as the pre-deposit to it cannot be acceded to. Thus decisions relied upon by the counsel which are in relation to refund of pre-deposit are clearly distinguishable and not applicable to present case. 7.0 Learned counsel argued that in any case he has not passed on the burden of the amounts deposited by him on the customers and has borne the same. In their case the final product, cable jointing kit is exempt from payment of Central Excise duty. The duty is being paid by them on the dutiable intermediate products, after determining the value of same on cost construction basis using CAS-4. Since these intermediate products have been consumed captively, he could not have passed on the burden of duty. He stated that in this case the amounts claimed as refund were not charged on the invoice and were deposited by him during the course of investigation. S....
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....n from customers but duty paid under compulsion, must have reflected in ultimate cost of finished goods, clause of unjust enrichment applicable. 9.4. C.A. Certificate alone is not sufficient evidence. It has been held in various judicial pronouncements. Some are mentioned belowa. Hanil Textile vs CCE Raigad [2008 (225) ELT 117 (Tri-Mum) Para 2)] b. Kirloskar Oil Engine Ltd Vs Commissioner Of Customs Mumbai [2004 (174) ELT 54 (Tri Mum) (Para 5 & ^)] c. CC Mumbai Vs Eltech [1999 (112) ELT 877 (Tri- Mum)]" 8.0 It has also been admitted by the Appellant vide his letter dated 26.12.2008 that these payments have been reflected as expenses during the relevant years in their books of account (Profit and Loss account). Tribunal has in case of Rajasthan Spinning & Weaving Mills Ltd vs Commissioner Central Excise Jaipur [2006 (194) ELT 254 (T)] held that- "any amount paid by the appellants or any company, is in the form of expenses, and is generally accounted as an expenses in their Profit and Loss Account. Costing of the products of the company takes into consideration all the expenses charged to expense in their Profit and Loss Account and are....