AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2018 (10) TMI 949
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....uppliers did not agree to supply material without payment of duty. During the period 22.09.2011 to 24.01.2012, the appellant purchased bitumen on payment of duty and filed refund claim of duty paid on bitumen with the Assistant Commissioner, Central Excise, Hissar on 26.08.2013. A show cause notice was issued to the appellant on 21.11.2013 to deny refund claim on the following grounds: (a) there is no provision of refund under Notification No. 108/95-CE dated 28.08.1995 as the Notification grants the complete exemption from payment of duty and the said Notification nowhere provides for payment of duty and subsequent grant of refund of the said duty. (b) Notification No. 108/95 dated 28.08.1995 provides exemption only the party, who is a manufacturer of the goods. (c) Party has executed its project in Jhajjar District and has procured Bitumen from the various manufacturers who also do not fall under the jurisdiction of this division. Moreover, the party is neither a manufacturer nor registered with Central Excise Division, Hissar thus it appears that the party has not filed the refund claim with the proper jurisdictional officer. (d) A plain reading of Section 11B of the Central....
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....e appellant has purchased cement and steel without payment of duty which indicates that goods used in the project were exempt from duty, in terms of Notification No. 108/95. It also confirms that the appellant was not required to pay duty on bitumen and duty has been wrongly paid by the appellant. It is submitted that as per proviso of Section 11B (2)(e) the Central Excise also permits refund to buyer, therefore, the appellant had every right to file refund claim. Even otherwise, it is case of payment of duty by mistake and Government has no right to retain because it amounts to violation of article 265 of the Constitution of India. 6. It is further submitted that Notification No. 108/95 is an exemption notification and Central Excise duty is an indirect tax, therefore, even though notification exempt manufacturer from payment of duty at the time of clearance of goods, nevertheless exemption is actually extended to product in question and its buyer. Therefore, it is wrong to say that manufacturer could avail exemption and said notification is not applicable to buyer. The said notification does not prescribe manner of refund, but the respondent has no right to retain legal money of....
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....ed by the decision of the Hon'ble Karnataka High Court in the case of CCE versus K.V.K. Construction,2012 (26) STR 195 (Karnataka) and Hon'ble Madras High Court in the case of Nataraj and Venkatt Associates Versus Assistant Commissioner, 2010 (249) ELT 37. 9. It is his contention that the claim was filed initially with DGFT who rejected application on one or the other ground as the appellant paid duty under Central Excise Act, so refund is governed by Central Excise Act read with Constitution of India. It is not a case of appeal from one authority to another whereas it is a case of two independent authorities when both are competent to consider the claim. The DGFT did not consider because duty was paid under Central Excise Act. The period spent before DGFT needs to be excluded as per the decision of the Hon'ble Gujarat High Court in the case of Choice Laboratories 2015 (315) ELT 197 (Guj.). therefore, he prayed that the impugned order is to be set aside and refund claim be allowed. 10. On the other hand, the Ld. AR reiterated the finding in the impugned order. 11. He further submits the appellant has purchased bitumen for execution of work in Jhajjar District of Haryana whereas....
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....bmissions. 13. On careful considerations of submissions made by both the sides, as per the show cause notice, the refund claim sought to be denied on the following grounds: (a) there is no provision of refund under Notification No. 108/95-CE dated 28.08.1995 as the Notification grants the complete exemption from payment of duty and the said Notification nowhere provides for payment of duty and subsequent grant of refund of the said duty. (b) Notification No. 108/95 dated 28.08.1995 provides exemption only to the manufacturer of the goods as per their refund claim. (c) Party has executed its project in Jhajjar District and has procured Bitumen from the various manufacturers who also do not fall under the jurisdiction of this division. Moreover, the party is neither a manufacturer nor registered with Central Excise Division, Hissar thus it appears that the party has not filed the refund claim with the proper jurisdictional officer. (d) A plain reading of Section 11B of the Central Excise Act, 1944, has revealed that the refund claim is not admissible to the party in terms of the said section. (e) The scrutiny of the above said refund claim has also revealed that an amount of Rs....
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....even when he had passed on the burden of duty to others. No law conferred such a right in him - not Article 265, nor Section 11B. It was only on account of an incorrect view of law taken in Kanhaiyalal - and that cannot be treated as a vested legal right. Correction of judicial error does not amount to deprivation of vested/substantive rights, even though a person may be deprived of an unwarranted advantage he had under the over-ruled decision. In cases, where the burden is not passed on, there is no prejudice; he can always get the refund. IS SECTION 11B A MERE DEVICE TO RETAIN ILLEGALLY COLLECTED TAXES ? 89. A major attack is mounted by the learned Counsel for petitioners-appellants on Section 11B and its allied provisions on the ground that real purpose behind them was not to benefit the consumers by refusing refund to manufacturers (on the ground of passing on the burden) but only to enable the Government to retain the illegally collected taxes. It is suggested that the creation of the Consumer Welfare Fund is a mere pretence and not an honest exercise. By reading the Rules framed under Section 12D, it is pointed out, even a consumer, who has really borne the burden of tax ....
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....o may have borne the burden; the Rules only provide for "grants" being made in favour of consumer organisations for being spent on welfare of consumers. But, this is perhaps for the reason that Clause (e) of the proviso to sub-section (2) of Section 11B does provide for the purchaser of goods applying for and obtaining the refund where he can satisfy that the burden of the duty has been borne by him alone. Such a person can apply within six months of his purchase as provided in Clause (e) of Explanation-B appended to Section 11B. It is, therefore, not correct to contend that the impugned provisions do not provide for refunding the tax collected contrary to law to the person really entitled thereto. A practical difficulty is pointed out in this behalf by the learned Counsel for appellants-petitioners : it is pointed out that the manufacturer would have paid the duty at the place of "removal" or "clearance" of the said goods but the sale may have taken place elsewhere; if the purchaser wants to apply for refund - it is submitted - he has to go to the place where the duty has been paid by the manufacturer and apply there. It is also pointed out that purchasers may be spread all over I....
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....d claim, he would have transferred the application for refund claim before the competent authority but could not have rejected the refund claim simply on the ground that he had no jurisdiction. We also take note of the fact that the adjudicating authority although held that he has no jurisdiction, despite having no jurisdiction, has entertained the refund claim on merits. 19. As the issue raised in the show cause notice is that the authorities with whom the refund claim has been filed have no jurisdiction but the said authority entertained the refund claim filed by the appellant on merits, therefore, in the light of the decision of this Tribunal in the case of Swiber offshore Construction PTE. Ltd. reported in 2012 (281) ELT 545 (Tri. Mum.) wherein it has been observed that this Tribunal have no jurisdiction to entertain the appeal but Member (Technical) has remanded the matter back for fresh consideration. As "Hon'ble Member (Technical) has exercised his jurisdiction to entertain the appeal. In that circumstance, the appeal cannot be dismissed on the ground of lack of jurisdiction", therefore, as in this case, the adjudication authority as well as the appellate authority has deal....
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....relevant date. Admittedly, in this case, the refund claim initially was filed by the appellant before the DGFT and DGFT has rejected their refund claim only on 10.03.2013, thereafter the refund claim was filed by the appellant on 26.08.2013. In these circumstances, limitation for filing the refund claim was start on 10.06.2013 i.e. relevant date and the refund claim was filed in time. Moreover, we also take note of the fact that the appellant was not liable to pay duty on the said goods but the supplier of bitumen forced the appellant to pay duty. In that circumstances, the duty which were not payable by the appellant cannot be held duty in terms of the Central Excise Act, therefore, the said amount is only a amount paid by the appellant and that does not form the part of duty paid by the appellant and the same has been paid under bona-fide mistake. In that circumstances, the said amount cannot be retained by the Revenue and is required to be refunded. 25. We further take note of the fact that in the case of Nataraj and Venkatt Associates (Supra) the Hon'ble High Court of Madras has entertained the issue wherein the service tax was not payable by the assessee and the petitioner fi....
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....f constitution of India. In that circumstance, the appellant is entitled for refund claim of duty paid by them by mistake or forced to pay by the supplier and held that the refund claim is entertainable. 27. Further in the case of Parijat Construction vs. CCE, Nashik reported in 2018 (359) ELT 113 (Bom.), the issue came up before the Hon'ble High Court of Bombay wherein tax was paid under mistake of law. The Hon'ble High Court observed as under: "5. We are of the view that the issue as to whether limitation prescribed under Section 11B of the said Act applies to a refund claimed in respect of service tax paid under a mistake of law is no longer res integra. The two decisions of the Division Bench of this Court in Hindustan Cocoa (supra) and Commissioner of Central Excise, Nagpur v. M/s. SGR Infratech Ltd. (supra) are squarely applicable to the facts of the present case. 6. Both decisions have held the limitation prescribed under Section 11B of the said Act to be not applicable to refund claims for service tax paid under a mistake of law. The decision of the Supreme Court in the case of Collector of C.E., Chandigarh v. Doaba Co-Operative Sugar Mills (supra) relied upon by the Ap....