2024 (1) TMI 245

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.... along with interest and penalty was also imposed. Being aggrieved, the appellant filed appeal before Commissioner (Appeals), who vide Order-In-Appeal No. 51(NG)CE/JPR/2018 dated 11.04.2018, rejected the appeal. The appellant challenged the said Order-In-Appeal before the Hon'ble CESTAT which was allowed by the Hon'ble CESTAT vide Order No. A/50935/2019-Ex(DB) dated 26.03.2019. The appellant filed consequential refund claim of Rs.16,66,469/-, which was deposited by them during investigation on 29.11.2019. The adjudicating authority vide Order dated dated 31.12.2019 sanctioned the refund to the appellant. The revenue, pursuant to Review Order No. 09/2020 dated 23.03.2020, filed appeal against the said Order dated 31.12.2019 which was allowed vide Order-In- Appeal No. 78(SM)CE/JPR/2021 dated 01.04.2021 passed by Commissioner (Appeals), Jaipur. Being aggrieved, the appellant has filed the present appeal. 2. We have heard Shri D.K. Tyagi, learned Advocate for the appellant and Shri Unmesh Kumar, learned Authorized Representative for the department. 3. Learned counsel for the appellant has mentioned that the amount in question was paid by the appellant pending the investig....

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.... the appellant. The Chartered Accountant's Certificate cannot solely be relied in arriving at the conclusion that the burden of duty has been borne by appellant himself. Although the amount of tax has not been directly recovered from the customers by the appellant but has been charged to expenses in their books of accounts, the appellant has indirectly recovered the tax and hence has failed to cross the bar of unjust enrichment. Once the amount is booked in the Profit and Loss Account, it entails passing of the incidence of duty to the customers. Thus the amount of duty and interest booked by the appellant as expenses in their Profit and Loss Account, the same is hit by the clause of unjust enrichment and is therefore liable to be credited to the Consumer Welfare Fund in terms of provisions of Section 11B(2) of the Central Excise Act, 1944. Learned Authorized Representative has relied upon the following decisions: (i) Mahindra Engg. & Chemical Products Ltd. reported as 2019 (368) E.L.T. 84 (Tri.-Mumbai) (ii) A.A. Memon & Company reported as 2012 (27) S.T.R. 41 (Tri.-Ahmd.) (iii) Hindustan Petroleum Corpn. Ltd. reported as 2015 (328) E.L.T. 490 (Tri.-M....

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.... applicable to the case of refunds. 5.3 In the present case, admittedly the amount was deposited by the appellant during the investigation when department proposes to deny him the benefit of SSI exemption. Later the said denial was set aside and the appellant was held entitled for the said SSI exemption. Admittedly the goods were already cleared prior the payment of the impugned amount by the appellant. We observe that the period involved in the present dispute is the Year 2009-10 and 2010-11 whereas the payment was made in the Year 2013-14. Thus the payment was made even prior the issuance of show cause notice of demand denying exemption dated 18.02.2014. These admitted facts are sufficient to rebut the presumption of Section 12B of Central Excise Act because once the amount involved in refund was not paid at the time of clearance of goods but subsequently during the course of investigation for the past period when the goods had already been cleared earlier, the question of passing of said burden to the buyers does not at all arise. 5.4 No doubt it is not the amount of duty but the incidence of duty which has to be passed on irrespective, what has to be seen that as to wheth....

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....mount in question as a subsequent stage (in that case the amount in question was deposited in compliance with some interim order in assessee's books of accounts). Hon'ble Apex Court has also clarified, in this case, that even if the assessee has shown such amount as 'expenses' in accounts, it does not mean that the burden has been passed to his customers. Hon'ble High Court of Madras also in the case of Commissioner of Central Excise, Coimbatore Vs. Pricol Ltd. reported as 2015 (322) ELT 703 (Mad.) has held the refund of the amount as was deposited during investigation was not the amount of duty. Therefore, the principle of unjust enrichment would not apply when the refund is claimed for the said amount. The decision was followed by Hon'ble Allahabad High Court in the EBIZ.Com Pvt. Ltd. Vs. Commissioner of Central Excise reported as 2016 (9) TMI 1405, where the Hon'ble Court examined the provisions of Section 11AB of the Central Excise Act, 1944, which contemplates that the amount shall be refunded to the assessee provided the incidence of such duty had not been passed on by him to any other person. The Allahabad High Court held that any amount deposited during the pendency of the ....