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2019 (8) TMI 1592
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....h envisages: "35G. Appeal to High Court. - (1) An appeal shall lie to the High Court from every order passed in appeal by the Appellate Tribunal on or after the 1st day of July, 2003 (not being an order relating, among other things, to the determination of any question having a relation to the rate of duty of excise or to the value of goods for purposes of assessment), if the High Court is satisfied that the case involves a substantial question of law." [4] Relevant facts are that the assessee is engaged in manufacture of Urea (Nitrogenous Fertilizer) which is sold to ultimate customers. Assessee filed a 'Form-R' vide their letter reference No. NFVP/F&A/PUR/S.Tax/Refund on 09/05/2011 claiming thereby refund of service tax amount to Rs. 1,95,37,953/- paid by them to (i) M/s Gas Sale and Transportation of APM Gas (Rs. 1,34,54,695/-), (ii) Gas Sale and Transportation of PMT Gas (Rs. 28,63,279/-), (iii) Gas sale and Transportation of SPOT Gas (Rs. 4,94,935/-) and (iv) Rs. 27,25,044/-, for the period 20/11/2008 to 15/06/2010 in respect of claim No. (i) to (iii) and April 2009 to March 2010 for (iv) with regard to supply and Transportation Agreement. [5] The ser....
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....their product, the element of Service Tax which sought to be refunded. Hence, the assertion of the Noticee that they have themselves borne the incidence of tax is not acceptable as not supported by documentary evidence, therefore, refund cannot be granted to the Noticee. [7] The notice culminated into an order on 24/10/2011 rejecting the claim for refund for the self same reasons which finds mention in the notice. Commissioner (Appeals), vide order dated 14/03/2012 affirmed the order rejecting the refund. [8] As regard to limitation, the Appellate Authority observed:- "I find that regarding issue of time limit, the provisions of Section 11B of the Central Excise Act, 1944 are explicitly clear. The appellant's contention that the rate for transportation of gas was fixed by PNGRB on provisional basis, which was finalized subsequently, and therefore, relevant date for computing the time limit would be the date of such reduction as provided under Section 11B(b)(d) of the Central Excise Act, 1944, is not sustainable as in the case of the appellant, the agreement for supply of gas was with IOCL, who in turn entered into an agreement with GAIL for transportation of g....
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....which also comes under the jurisdiction of the adjudicating authority. The appellant had also contended that the factual verification of service tax payment of Range Superintendent of M/s GAIL is not difficult or impossible. According to the appellant even the CBEC's Manual of Supplementary Instructions stated in Chapter 9 Para 4 thereof that Report of the Superintendent of Central Excise should be obtained by the Divisional Office in refund cases. Further, in terms of Section 11B, refund can even be claimed by the service user or purchase of the goods user. The fact of duty/ tax burden having been paid can only be proved with reference to payment made by the appellant to IOCL/ GAIL as per the agreements which in the present case are not in dispute. I find that the above contention of the appellant regarding non-submission of proof of payment of Service Tax is not convincing and acceptable as it is a settled principle of law that in case of refund whosoever claims has to substantive their claim that they are eligible for the claim on the basis of documentary evidence for payment of the amount of refund claimed by the appellant. The appellant instead of discharging thei....
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....a statutory authority in terms of Petroleum and Natural Gas Regulatory Board (Determination Of Natural Gas Pipeline Tariff) Regulation 2008. The Board, which was constituted under the Petroleum and National Gas Regulatory Board Act, 2006 is entrusted with fixing the tariff, determination the actual tariff, which are to be followed by the gas companies. In such situation, it is apparent that the service tax payment is on a provisional value. The tariff is managed by statutory Authority as per law passed by Parliament. As such, following the ratio of the Tribunal in the above mentioned decisions, we hold that the limitation has to be accordingly reckoned and the claims are to be processed. 7. Regarding the evidence of payment of service tax to the Government, the appellant claimed that the provider of service has given a certificate to this effect. These are Public Sector Undertakings and have categorically stated that about the payment of service tax. We note that, if need be, such payment can be cross- verified by the Original Authority with jurisdictional officer in order to satisfy the correctness of the claim. Similarly, the appellant claimed that they are not barred by....
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....of the said expression. A dispute as to the classification of goods and as to whether or not they are covered by an exemption notification relates directly and proximately to the rate of duty applicable thereto for purposes of assessment. Whether the value of goods for purposes of assessment is required to be increased or decreased is a question that relates directly and proximately to the value of goods for the purposes of assessment. The statutory definition of the said expression indicates that it has to be read to limit its application to cases where, for the purposes of assessment, questions arise directly and proximately as to the rate of duty or the value of goods". Hon'ble Supreme Court as evident, was dwelling on the aspect where the assessee was granted an advance import licence for the import of Crude Emetine under a duty exemption scheme (DEEC) which required the assessee to export the goods after processing them. The goods that were imported by the assessee was found, on chemical analysis performed at the request of Customs Authorities, to contain emetine hydrochloride, moisture and other impurities. The Additional Collector of Customs held that the goods imp....
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....the refund claims involving Rs. 1,44,10,336/- the Revenue had already granted refund as a result of order in Appeal No. IND-CEX-000-APP-305-14, dated 14/10/2014 passed by the Commissioner (Appeals) Indore and the Revenue has not gone in appeal challenging the order of refund. The submissions are taken note of and are rejected for the reasons that the present case besides limitation under Section 11B also turns on Section 12B. Whereas, the case referred to relates to only limitation under Section 11B. True it is that the order in appeal referred to was dwelling on three issues, viz (i) the claim is hit by limitation in terms of Section 11B of the Central Excise Act, 1944; (ii) the appellant had failed to produce the proof of payment of duty; (iii) the appellant had failed to prove that the burden of tax has not been passed on to the buyer. There is no material on record to establish that the assessee has not passed the burden of tax to their customers in response to the show cause notice. The order rejecting the claim for refund reveals discarding of Chartered Accountant's certificate dated 27/05/2011 AB/AC3 that as per the provisions of Section 12B, the Noticee are required ....
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.....P. has paid service tax finally to the Government of India? (d) Whether the principle of undue enrichment is applicable to the present claim of refund of service tax by the respondent? [20] We, however, observe that the CESTAT has cryptically decided the appeal which is apparent from paragraphs 6 and 7 of the impugned order. By observing that since tariff is managed by the statutory body to be followed by the gas companies and the service tax payment is provisional and therefore with the determination of final rate, a right accrues in the assessee; therefore, the limitation is to be construed accordingly. Apparently, the Tribunal glossed over the fact that the M/s GAIL had not sought a provisional assessment and it was not its case that on final assessment that there is a determination that the service tax paid is on the higher side and therefore it should revert to the receiver of service. [21] Dwelling on the issue as to "whether a claim for refund after final assessment is governed by Section 11B of the Central Excise Act, 1944?, their Lordships in Commissioner of Central Excise, Mumbai-II v. Allied Photographics India Ltd. [(2004) 4 SCC 34], held:- "8. ....
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....ods used as inputs in accordance with the rules made, or any notification issued, under this Act; (d) the duty of excise paid by the manufacturer, if he had not passed on the incidence of such duty to any other person; (e) the duty of excise borne by the buyer, if he had not passed on the incidence of such duty to any other person; (f) the duty of excise borne by any other such class of applicants as the Central Government may, by notification in the Official Gazette specify: Provided further that no notification under clause (f) of the first proviso shall be issued unless in the opinion of the Central Government the incidence of duty has not been passed on by the persons concerned to any other person. (3) Notwithstanding anything to the contrary contained in any judgment, decree, order or direction of the Appellate Tribunal or any Court or in any other provision of this Act or the rules made thereunder or any other law for the time being in force, no refund shall be made except as provided in sub-section (2). Explanation. For the purposes of this section,- * * * (B) "relevant date" means * * * ....
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....he light of what is stated above, we now quote hereinbelow para 104 of the judgment of this Court in the case of Mafatlal Industries Ltd. (supra): "104. Rule 9-B provides for provisional assessment in situations specified in clauses (a), (b) and (c) of sub-rule (1). The goods provisionally assessed under sub-rule (1) may be cleared for home consumption or export in the same manner as the goods which are finally assessed. Sub-rule (5) provides that "when the duty leviable on the goods is assessed finally in accordance with the provisions of these Rules, the duty provisionally assessed shall be adjusted against the duty finally assessed, and if the duty provisionally assessed falls short of or is in excess of the duty finally assessed, the assessee shall pay the deficiency or be entitled to a refund, as the case may be". Any recoveries or refunds consequent upon the adjustment under sub-rule (5) of Rule 9-B will not be governed by Section 11-A or Section 11-B, as the case may be. However, if the final orders passed under sub-rule (5) are appealed against or questioned in a writ petition or suit, as the case may be, assuming that such a writ or suit is entertained and is allo....
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....o difference between such payment and duty paid under provisional assessment under the said Act. This argument was obviously advanced because unless the two payments are equated as contended, the respondent M/s APIL was required to comply with Section 11-B. In this matter, duty has been paid under protest. It is the case of the respondent M/s APIL that since such payment was similar to payment under Rule 9-B, the respondent M/s APIL was not required to comply with Section 11-B. In the light of the discussion hereinabove, we hold that the respondent was bound to comply with Section 11-B. Lastly, in any event, the application dated 11.2.1997 fell in the category of refund claim being made after finalization of assessment of NIIL and, therefore, Section 11-B had to be complied with in terms of para 104 of the above judgment in the case of Mafatlal Industries Ltd. (supra). For abovestated reasons, since there was failure to comply with Section 11-B, the respondent was not entitled to refund. 13. The point which still remains to be decided is whether the respondent herein was entitled to refund without complying with Section 11-B of the Act on the ground that it had st....
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....The entire scheme of Section 11-B showed the difference between the rights of a manufacturer to claim refund and the right of the buyer to claim refund as separate and distinct. Moreover, under Section 4 of the said Act, every payment by the manufacturer whether under protest or under provisional assessment was on his own account. The accounts of the manufacturer are different from the accounts of a buyer (distributor). Consequently, there is no merit in the argument advanced on behalf of the respondent that the distributor was entitled to claim refund of "on account" payment made under protest by the manufacturer without complying with Section 11-B of the Act." [22] Recently, in Steel Authority of India vs. Commissioner of Central Excise, Raipur; Civil Appeal Nos.2150, 2562/2012, 600, 1522-23 and 599/2013 decided on 08/05/2019, it is held: "9. At this juncture we think it apposite to refer to the facts in MRF case (MRF Limited v. Collector of Central Excise, Madras). MRF Case was decided on 12.3.1997 and it is reported in 1997 (5) SCC 104. The appeal was filed in this Court against the order passed by the Tribunal dated 24.9.1986. By the impugned order the assessee's c....
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.... case admittedly that at the time goods were removed the price was not fixed. The Assessee was fully conscious of the fact that it was subject to variation. Assessee must be imputed with knowledge that the value it was declaring was amenable to upward revision. The circumstances were indeed clearly both apposite and appropriate for the Assessee to invoke the provisions of Rule 7 and seek an order for provisional assessment. In fact, take the example of manufacturer A and manufacturer B. Both remove goods under contracts which contain escalation clauses. Manufacturer A invokes Rule 7. It seeks permission for removal of goods on provisional assessment. Though an order of final assessment has to be passed within a period of time it is capable of being extended without any time limit. Manufacturer-A on the basis of upward revision of the price with retrospective effect and acknowledging the value to be the value as provisionally assessed and as enhanced by the escalation arrived at under the escalation clause pays the duty when the escalation comes into effect on the difference in the value under Rule 7. Apart from payment of the differential excise duty manufacturer ....
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....ally determined and it is on the said differential value that admittedly that differential duty is paid. We would think that while the principle that the value of the goods at the time of removal is to reign supreme, in a case where the price is provisional and subject to variation and when it is varied retrospectively it will be the price even at the time of removal. The fact that it is known, later cannot detract from the fact, that the later discovered price would not be value at the time of removal. Most significantly, Section 11A and Section 11AB as it stood at the relevant time did not provide read with the rules any other point of time when the amount of duty could be said to be payable and so equally the interest. We would concur with the views expressed in SKF case (supra) and International Auto (supra). We find no merit in the appeals. The appeals will stand dismissed." [24] In another recent judgment in Western Coalfields Ltd. Vs. Commissioner of Central Excise Trichy, Madurai [AIR 2019 SC 1069], it is held: "12. Section 11B deals with the claim of refund of duty as paid on his own accord by any person for refund of such duty to the competent authority before....