TaxTMI 
TaxTMI 
2025 (9) TMI 122
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....r final products. 2.2 After verification of the claim made through jurisdictional range officer, it was observed that refund claim was not admissible for following reasons:- "(i) From the scrutiny of invoices issued from the factory to the warehouse, there is nothing on record to show that incidence of Central Excise duty has not been passed on to customers as the goods have been cleared to their own warehouse and from there the goods are sold on the fixed price on the strength of invoice wherein the MRP of the product is also mentioned. (ii) It is also not on record that the excess payment of duty has not affected the MRP of the goods cleared at high rate/excess payment. (iii) Further, the party has not submitted any proof along with the refund claim which can confirm that the duty incidence to the extent paid in excess, has not been borne by them." 2.3 Show cause notice dated 13.10.2016 was issued proposing as to why their refund claim dated 04.08.2016 for Rs. 17,25,830/- filed under Section 11B of Central Excise Act, 1944 should not be rejected. 2.4 The said show cause notice was adjudicated as per the Order-in-Original dated 17.10.2017 referr....
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....le of goods from their warehouse during the period from July, 2015 to November, 2015. • The price at which the goods were sold from their warehouse was a pre-agreed one with their buyers and no excise duty was included in the same since it was much less than the MRP, less abatement of 35%. • The Adjudicating Authority has in his order observed that refund claim made by the appellant was pre-audited by the Department before sanction. • Impugned order questioning the veracity of the Chartered Accountant's certificate against unjust enrichment, he is not only questioning the integrity but has also undermined the position of the independent authority. • In their balance sheet & ledger account which were produced before the Commissioner (Appeals), clearly showed that excess duty paid as amount recoverable from Government. • Reliance is placed upon the following decisions- o Commissioner of Central Excise Vs Aquasub Engineering o CCE Vs Metro Tyres Ltd. 1996 (82) ELT 95 dismissed by the Hon'ble Supreme Court 1997 (94) ELT A51 (SC). o Triveni Chemicals Ltd. Vs Union of India & Anr. Civil Appeal No.....
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....atment given to purchases by buyer in his own account were relevant circumstances which authorities below failed to examine Buyer has not further passed on incidence of duty not proved Refund disallowed Section 11B of Central Excise Act, 1944. 4.4 It is noticed that at the time of deciding the Ashish Rolling Mills case, the Hon'ble Gujarat High Court completely ignored the settled law laid down by the Hon'ble Supreme Court in the landmark judgment of Allied Photographics India Ltd. case. Moreover, relying on the Apex Court's decision (supra) the Jurisdictional High Court of Judicature at Allahabad, in the case of Sanat Products Limited vs. CCE [2015 (323) ELT 682 (All.)] has held that "Refund -Unjust enrichment - Appellant pleading that they have not recovered duty from customers, price being constant prior and after imposition of duty and hence unjust enrichment not applicable - Apex Court in case of Allied Photographics India Ltd. [2004 (166) E.L.T. 3 (S.C.)] laying down law that uniformity of price, before and after assessment, does not lead to inevitable conclusion that incident of duty not passed on Following aforesaid law settled by Apex Court and in abse....
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....nless the contrary is proved by him, be deemed to have passed on the full incidence of such duty to the buyer of such goods. 4.8 The respondent submitted one Chartered Accountant's certificate which simply states that burden of excise duty has not been passed on by the manufacturer to the buyer or any other person by any kind. Chartered Accountant's certificate must explain as to how incidence of duty not passed on to buyer by showing cost structure, etc., which, in the instant case, is absent. No other evidence produced before the appellate authority by the respondent showing that the incidence of duty burden has not been passed on to any other person. Chartered Accountant's certificate cannot be a conclusive proof of the fact that duty incidence has not been passed on. Owing to overwhelming balance of proof in favour of the department against respondent's claim of non-passing of duty incidence to any person, I find that such a nonspecific/generic certificate issued by Chartered Accountant, cannot, in any way, come to rescue the respondent's claim. 4.9 Under the facts and circumstances of the present case read with ratio of the judicial pronou....
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.... prevented by sufficient cause from presenting the appeal within the aforesaid period of sixty days, allow it to be presented within a further period of thirty days.] [(1A) The Commissioner (Appeals) may, if sufficient cause is shown, at any stage of hearing of an appeal, grant time, from time to time, to the parties or any of them and adjourn the hearing of the appeal for reasons to be recorded in writing : Provided that no such adjournment shall be granted more than three times to a party during hearing of the appeal.] (2) Every appeal under this section shall be in such form and shall be verified in such manner as may be specified by rules made in this behalf." 43. As the order of self-assessment is nonetheless an assessment order passed under the Act, obviously it would be appealable by any person aggrieved thereby. The expression 'Any person' is of wider amplitude. The revenue, as well as assessee, can also prefer an appeal aggrieved by an order of assessment. It is not only the order of re-assessment which is appealable but the provisions of Section 128 make appealable any decision or order under the Act including that of self-asses....
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.... Blue Industries Ltd. (supra). 45. Reliance was also placed on a decision of Rajasthan High Court with respect to service tax in Central Office Mewar Palace Org. v. Union of India - 2008 (12) S.T.R. 545 (Raj.). In view of the aforesaid discussion, we are not inclined to accept the reasoning adopted by the High Court, that too is also not under the provisions of the Customs Act. 46. The decision in Intex Technologies (India) Ltd. v. Union of India has followed Micromax (supra). The reasoning employed by the High Courts of Delhi and Madras does not appear to be sound. The scope of the provisions of refund under Section 27 cannot be enlarged. It has to be read with the provisions of Sections 17, 18, 28 and 128. 47. When we consider the overall effect of the provisions prior to amendment and post-amendment under Finance Act, 2011, we are of the opinion that the claim for refund cannot be entertained unless the order of assessment or self-assessment is modified in accordance with law by taking recourse to the appropriate proceedings and it would not be within the ken of Section 27 to set aside the order of self-assessment and reassess the duty for making refun....
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....ring Pvt. Ltd. 2018 (15) GSTL 708 (Guj) wherein following has been held:- "4. The Court noticed that similar view was expressed by Punjab and Haryana High Court in case of Commissioner of Central Excise v. First Flight Courier Limited reported in 2011 (22) S.T.R. 622 (P&H) and by Karnataka High Court in case of Commissioner of Service Tax, Bangalore v. Motor World reported in 2012 (27) S.T.R. 225 (Kar.). 5. Learned Counsel for the department however brought to our notice judgment of Kerala High Court in case of Asstt. CCE & Ors. v. Krishna Poduval & Ors, (W.A. Nos 715 and 717 of 2005, judgment dated 20-10-2005) [2006 (1) S.T.R. 185 (Ker.)]. However when decision of this Court is already rendered, we would be bound by such decision." 4.8 It is noted that Commissioner (Appeals) has undermined the authority of the notified Chartered Account, he found that Chartered Accountant's Certificate not meeting the requirements of the law in terms of showing that portion of duty has not been based on the any other portion, he rejected the same. He further found that it is also settled law that the issue of unjust enrichment is to be decided by the concern authorities as per....
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.... amounts is under the category of short term loans and advances is balance with government authorities but nothing is indicated that the burden of the central excise duty paid at the time of clearance of the goods has not been based on to their customers. The appellant has declared MRP in respect of these goods which would have been included all the duties and taxes paid at the time of sale of the goods to the final consumers. Even if the goods were or were not to be assessed under Section 4A of Central Excise Act, the duty paid was passed on to the buyer of the goods. The presumption that incidence of the duty has been passed on to the buyer of the goods is statutory presumption as per Section 12A and 12 of the Central Excise Act, 1994. The said sections are reproduced below: "12A. Price of goods to indicate the amount of duty paid thereon.- Notwithstanding anything contained in this Act or any other law for the time being in force, every person who is liable to pay duty of excise on any goods shall, at the time of clearance of the goods, prominently indicate in all the documents relating to assessment, sales invoice, and other like documents, the amount of such duty whic....
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....ence of duty had passed on to the customers of the assessee. 8.4 Furthermore, we notice that the certificate of the concerned Chartered Accountant's firm only states that a sum of Rs. 18,91,216.47 is receivable by the appellant from the Customs authorities. It further states that based on the explanation given to them, they believe that the said sum had not been collected by the assessee, from its customers. We must indicate that in the opening paragraph of the Chartered Accountant's certificate, seems to indicate that the books of accounts and the relevant supporting documents have been verified. If, that was the position, then, we see no reason why the assessee could not produce the relevant invoices, i.e., supporting documents before the Tribunal, despite opportunity having been given, in that behalf. 9. In so far as the judgment of the Division Bench of the Delhi High Court in Hero Motocorp Limited v. Commissioner of Customs (Import and General) - 2014 (302) E.L.T. 501, is concerned, according to us, the said judgment does not help the cause of the assessee. A careful reading of the said judgment would show that the assessee in that case had placed on record, ....
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....was mentioned in the said notice that the burden of proof to show that full incidence of duty has not been passed on to the buyers is on the assessee as per Section 12B of the Act. The Assistant Collector held that the assessee is entitled for refund. The first appellate authority rejected the appeal filed by the Revenue. The Revenue's appeal before the Tribunal was allowed holding that the assessee would be entitled to grant of refund only if he had not passed on duty burden to his buyers. It was also held that the buyer in turn would be entitled to refund only if he has not passed on the incidence of duty to any other person. Further the Tribunal held that the event which gives rise to cause of action for refund is payment of duty made in respect of goods cleared from the factory and once the duty burden had been passed on to the buyer at the time of clearance, issuance of credit note at a later point of time would not entitle the assessee to claim any refund. The Tribunal also held that burden of duty is normally passed by the manufacturer to the dealer and to the ultimate consumer. 11. The said assessee filed an application for reference to this Court, Madras and one o....
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....s entitled for a refund and whether there would be unjust enrichment if the said refund was allowed. The Hon'ble Supreme Court noted that the Special Bench of CEGAT, New Delhi held that turnover discount was not an admissible abatement on the ground that the quantum of discount was not known prior to the removal of goods and in an appeal filed by the assessee before the Hon'ble Supreme Court by judgment dated 11-3-1997, it was held that turnover discount is an admissible deduction. The Department contended that any credit note that was raised post clearance will not be taken into account for the purpose of refund by the Department. This submission was not accepted by the Hon'ble Supreme Court by referring to the decision in Union of India v. Bombay Tyre International Private Limited [1984 (17) E.L.T. 329 (S.C.)], wherein it was held that trade discounts shall not be allowed only because they are not payable at the time of each invoice or deducted from the invoice price. Thus it was held that the assessee is entitled for filing a claim for refund on the basis of the credit notes raised by him towards trade discounts. Thus the issue in Addison & Co. Limited was as to whether the clai....
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.... by the Central Government by a notification in the official gazette who are also entitled for refund of the duty of excise. A plain reading of Clauses (d), (e) and (f) of the proviso to Section 11B(2) shows that refund to be made to an applicant should be relatable only to the duty of excise paid by the three categories of persons mentioned therein i.e. the manufacturer, the buyer and a class of applicants notified by the Central Government. Clause (e) refers to the buyer which is not restricted to the first buyer from the manufacturer. The buyer mentioned in the above Clause can be a buyer downstream as well. While dealing with the absence of a provision for refund to the consumer in the rules this Court in Mafatlal Industries v. Union of India (supra) held as follows :- "98. 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 Welfar....
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....ions of the Act go, they are unexceptionable. Section 12C which creates the Consumer Welfare Fund and Section 12D which provides for making the Rules specifying the manner in which the money credited to the Fund shall be utilised cannot be faulted on any ground. Now, coming to the Rules, it is true that these Rules by themselves do not contemplate refund of any amount credited to the Fund to the consumers who 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 a....
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.... Counsel for the petitioner referred to paragraph 35 of the judgment which deals with Civil Appeal No. 8488 of 2009 arising out of judgment of the High Court of Bombay. To be noted that the said case also pertains to a case of trade discount and the dispute was with regard to genuineness of the documents which was not initially produced at the time of filing the refund claim but subsequently produced and the genuineness having been satisfied, the appeal filed by the Revenue was dismissed. 15. In our considered view the said decision can be of no assistance to the case of the assessee before us as the fact situation was entirely different. Similarly, the case in TVS Electronics Limited also pertain to the discounts offered by the assessee which is passed on to the distributors [buyers] by virtue of post sales credit notes. The Division Bench by referring to paragraph 14 of the judgment in Addison & Co. Ltd., wherein it was held that the assessee is entitled for filing a claim for refund on the basis of credit notes raised by them towards discounts, remanded the matter to decide the aspect of unjust enrichment. On facts, the said decision cannot be applied to the assessee....
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....invoices/gate passes have collected the additional duty of excise from its customers/buyers. Much after that they filed a refund claim and produced the copies of credit notes stating that the duty collected from the buyers had been refunded to the assessee and hence they are entitled for claiming refund under Section 11B of the Act. Thus, it is not disputed by the assessee that the amount of duty of excise had been passed on to its customers. As rightly argued before us by Mr. A.P. Srinivas, the verification to be done by the Department, to enquire about the ultimate buyer who has actually paid the duty is not a futile exercise as refund can be granted only to a person who has paid the duty and not to anyone else and if the ultimate consumer cannot be identified, the amount would be retained in the fund. This is more so because the word "buyer" in clause (e) to proviso to Section 11B(2) of the Act cannot be restricted to the first buyer from the manufacturer. The basis for the claim of refund was on account of the fact that on or after 31-5-1990 the rate of duty was NIL. For the period between 31-5-1990 and 6-7-1990 the assessee paid additional duty of excise and had passed on the ....