TaxTMI 
TaxTMI 
2020 (11) TMI 352
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....ppeal (to hold that appellant is not eligible for refund claimed) because it committed fundamental error in coming to conclusion that buyer of the excisable goods viz PPNP had suffered the duty claimed as refund by the appellant. (c) Whether or not the Tribunal is in error when it says that the amount claimed as refund had been passed on to the buyer PPNP when it is on record that the buyer had been issued credit note towards excess duty charged (which is since claimed as refund) (d) Whether or not Tribunal erred in holding that judgment of the Hon'ble Supreme Court in Addison & Co. Ltd. case 2016 (339) ELT 177 (SC) applies even when the said judgment says that refund of excess duty paid has to be allowed once it is shown that the ultimate consumer of the excisable goods did not suffer the duty (claimed as refund). (e) Whether the Tribunal was correct in dismissing the appeal when the ultimate consumer in this case PPNP who was supplied excisable goods namely LPG by the appellant has not suffered the excess duty claimed as refund by the appellant as the ultimate consumer was refunded the excess duty (through credit note) and therefore the excess duty ....
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.... to be allowed once it is shown that the ultimate consumer of the excisable goods did not suffer the duty (claimed as refund). (e) Whether the Tribunal was correct in dismissing the appeal when the ultimate consumer in this case MFL who was supplied excisable goods namely LPG by the appellant has not suffered the excess duty claimed as refund by the appellant as the ultimate consumer was refunded the excess duty (through credit note) and therefore the excess duty claimed as refund had not been passed on. (f) Whether or not the Tribunal erred in assuming that the excess duty (claimed as refund in this proceedings) had been passed on merely because refund of such duty was through credit note. (g) Whether or not the sum and substance of the judgment of Hon'ble Supreme Court in Addison & Co. Ltd. case is that the ultimate user of the excisable goods in respect of which the refund is claimed ought not to have paid the duty claimed as refund by the manufacturer (assessee) (h) When credit note is a means for refunding the excess collected and it is shown through the books of accounts that the excess amount claimed has been refunded to the ultimate b....
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.... (g) Whether or not the sum and substance of the judgment of Hon'ble Supreme Court in Addison & Co. Ltd. case is that the ultimate user of the excisable goods in respect of which the refund is claimed ought not to have paid the duty claimed as refund by the manufacturer (assessee) (h) When credit note is a means for refunding the excess collected and it is shown through the books of accounts that the excess amount claimed has been refunded to the ultimate buyer of the subject excisable goods, whether refund could be rejected (i) Whether the proof that amount claimed as refund has not been passed on to the ultimate buyer is relevant or he mode (method / procedure) adopted establish the fact of the excess duty (claimed as refund) has not been passed on to the ultimate consumer is relevant for claiming refund under Section-11B of CEA'44. (j) Whether in the facts and circumstances of this case is it not enough to show that the ultimate buyer of the excisable goods KSCL had not borne the duty claimed as refund by the appellant to the eligible for refund. 2. The reason given by the learned Tribunal in its impugned order is quoted below for read....
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....ted by the Excise Department on the basis of the impugned show cause notice issued to the Appellant Corporation on 19 July 2002, which further resulted in adverse orders against the Appellant Corporation, being Order in Original on 29 November 2002, order passed by the Commissioner of Appeals dated 11 April 2018 and impugned order passed by the learned CESTAT on 10 May 2019. The facts of all the three appeals in this regard are similar. The purchasing company alone varied; M/s.Madras Fertilizers Ltd., in C.M.A.No.4299 of 2019 and M/s.Kothari Sugars and Chemicals Ltd., in C.M.A.No.4301 of 2019. Therefore, C.M.A.No.4298 of 2019 is taken as the lead case. 5. The learned Counsel for the Assessee urged before us that since the incidence of Excise Duty has not been passed on by the consumer of raw naptha in question, viz., M/s.PPN, for the electricity or power manufactured out of use of such raw naptha. The Appellant company is entitled to a refund and the only reason given in the impugned show cause notice for refusing the said refund to the Appellant was that on the basis of the Credit Notes issued by M/s.IOCL to M/s.PPN, refund could not be claimed by the Appellant M/s.CPCL. He has....
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.... the following terms :- 16. In the instant case, the Assessee has admitted that the incidence of duty was originally passed on to the buyer. There is no material brought on record to show that the buyer to whom the incidence of duty was passed on by the Assessee did not pass it on to any other person. There is a statutory presumption under Section 12-B of the Act that the duty has been passed on to the ultimate consumer. It is clear from the facts of the instant case that the duty which was originally paid by the Assessee was passed on. The refund claimed by the Assessee is for an amount which is part of the Excise Duty paid earlier and passed on. The Assessee who did not bear the burden of the duty, though entitled to claim deduction, is not entitled for a refund as he would be unjustly enriched. It will be useful to refer to the relevant para of Mafatlal Industries Vs. Union of India (supra) in this connection. "108. (iii) A claim for refund, whether made under the provisions of the Act as contemplated in Proposition (i) above or in a suit or writ petition in the situations contemplated by Proposition (ii) above, can succeed only if the petitioner/ plai....
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.... been issued by the Central Government as contemplated in Clause (f) to proviso to Section 11-B (2) of the Act. He contested that the claim for refund can be made only by the manufacturer or his buyer and any enquiry pertaining to unjust enrichment should be restricted only to the manufacturer and his buyer. The ultimate buyer/ consumer will not figure in the scheme of Sections 11-B, 12- A, 12-B and 12-C of the Act. This submission was accepted by the High Court in the impugned judgment. We do not approve the findings of the High Court in this regard. 7. Mr.A.P.Srinivas, learned counsel for the Revenue submitted that the moment the appellant M/s.CPCL has raised invoice on M/s.IOCL, who in turn has raised invoice for supply of raw naptha in question, on the buyer company M/s.PPN, the incidence of the Excise Duty is deemed to have been passed on by the appellant M/s.CPCL and therefore, the Appellant is not entitled to any refund of Excise Duty u/s 11B of the Act, merely because M/s.IOCL, the marketing company found that the valuation or price adopted for charging of Excise Duty was on the higher side and on that basis, Credit Notes are said to have been issued to the b....
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....who in turn raised invoice on the purchaser or buyer of the said raw naptha M/s.PPN, who in turn, manufactured power by use of such raw naptha and other raw materials. If at all, duty can be said to have been collected in excess on account of over valuation of the supplies, it is the consumer of the said raw material/raw naptha, viz., M/s.PPN who could have claimed the refund of Excise Duty as per the settled legal position. Merely because M/s.IOCL issued a credit note to the buyer M/s.PPN, it cannot be said that the incidence of Excise Duty was not passed on to the purchaser M/s.PPN. Once the incidence of Excise Duty has been passed on, whether it is further passed on to the ultimate buyer or consumer or not, is not the relevant question. The appellant Assessee M/s.CPCL, cannot be said to have borne any incidence of Excise Duty illegally levied and therefore, the right of the appellant Assessee to claim any refund cannot arise. The law in this regard of unjust enrichment has been settled as aforesaid, beyond pale of doubt, by the Constitution Bench Judgment of the Hon'ble Supreme Court in the case of Mafatlal Industries Ltd., reiterated and followed by the Hon'ble Supreme ....