TaxTMI 
TaxTMI 
TaxTMI 
2026 (2) TMI 663
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....to deny the exemption. The proceedings initiated culminated with the decision of co-ordinate Bench of CESTAT, Allahabad [Final Order No. A/70348/2018 dated 06.12.2018]. Accordingly, the appellant filed a claim for refund, of Rs.84,79,750/- on 28.01.2019, being the duty paid through PLA. The Adjudicating Authority vide Order dated 28.04.2022 [OIO No. 06/JC/RDR/Spl Cable/2021-22] sanctioned the refund claimed holding that the refund claim is not barred by limitation. The Adjudicating Authority, however, credited the amount to Consumer Welfare Fund in terms of Section 11B (2) of Central Excise Act, 1944. On an appeal filed by the respondents, Commissioner (Appeals) passed the following order: In view of the above discussion and findings, I allow the appeal No. 115/CE/APPL/DDN/2022-23 dated 27.12 2022 filed by M/s Special Cables Pvt. Ltd., Plot No. 60-65, Sector-3, SIDCUL, IIE, Pantnagar, Uttrakhand and the Order-in-Original No. 06/JC/RDR/Special Cable/2021-22 dated 28.04.2022 passed by the Joint Commissioner, CGST Division Rudrapur is modified to the extent that the refund sanctioned is ordered to be paid in cash to the appellant, alongwith consequential benefits, if any, as ....
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....istration i.e. clearances without payment of duty and clearances with payment of duty. Commissioner has also gone through the certificate issued by the Chartered Accountant in this regard. 7. Learned Advocate submits further that CESTAT, Ahmedabad had an occasion to discuss the case having identical circumstances in the case of M/s Dhariwal Industries Vs. Commissioner of Central Excise, Vadodara - 2005 (189) ELT 425. The Bench held that in terms of Central Excise Rules, no excisable goods could be cleared from a factory, except under an invoice containing all the particulars prescribed therein; therefore, it was compulsory for the appellants to prepare an invoice and show the rate of duty and the duty payable and discharged though under protest; the appellants kept the prices of the goods cleared by them constant; mentioning of the duty paid in the invoice itself would not be a conclusive evidence to allege that incidence of duty has been passed on to their buyers. Learned Advocate submits that the said decision of the Tribunal has been upheld by the High Court of Gujarat- 2014 (303) ELT 496 holding that mere fact that the invoices indicated Excise Duty, cannot be fatal to the a....
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....al Excise duty was absorbed by the appellant and was not passed on to the buyer. 16. also find that the appellant has submitted Price lists of their Final Products and an analysis of the same reveals that the appellant has never increased their prices substantially over the years except minor increase, which they have explained on account for the inflation and to compensate the increase in the prices of raw material, electricity, labour rate etc. which has been explained by the appellant. I find no reason to disagree with the contentions of the appellant. 17. The above methodology adopted by the appellant can be understood in the background of the facts that the appellant was dealing with Electrical wires which is very price sensitive item and most of their supplies had been to the Government Sector and large corporate buyers. Any increase in the price would have impacted them adversely and might have driven them out of the competition. 18. More so, the decision of the appellant to not pass on the impact of the payment of the Central Excise duty to their customers can be understood in the light of the fact that the Area based exemption under Notification ....
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....ot in itself a conclusive evidence that the incidence of duty has been passed on; if the prices are kept constant by keeping the profit margin low, it can be said that the incidence of duty has been borne by the appellant and has not been passed on to the customers. We find that this decision was upheld by the High Court of Gujarat and the Supreme Court. The High Court held that: 8. The issues before us are not very complex. A short-question is did the Tribunal commit an error in law in allowing assessee's refund claim holding that the principle of unjust enrichment would not apply? In order to decide such question, we may recall that the principal objections of the Department were that the sale invoice indicate higher rate of duty which in turn would imply that the assessee charged such duty to its consumers. The second ground for rejecting the refund claim was that mere constant sale value of the goods would not establish non-passing of the duty burden to the consumers. 9. In our opinion, both the objections are unsustainable. Admittedly, till January, 2001, the assessee was paying excise duty at a lower rate. For the months of January and February, 2001, the as....
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....etely unrelated to the assessee absorbing the impact of higher rate of duty. In the present case, however, as noted by the Tribunal and as pointed out to us during the course of this appeal from the record, there were several attending facts and circumstances which permitted the Tribunal to hold that the assessee had discharged the burden of establishing that this was not a case of unjust enrichment. 12. In addition to firmly establishing that in all cases of sales during January and February, 2001, the price of goods remained the same as was charged during the period immediately preceding the said months, despite the Department insisting on collecting higher rate of duties, the assessee had also filed affidavit of the responsible officer of the company that the burden of duty was not passed on to the consumers. It was also pointed out that the issue of higher rate of tax had cropped up only in Vadodara Commissionerate. The same was sorted out very shortly by the legislative changes. The assessee was confident that the objection of the Department was simply not sustainable and that the assessee would surely succeed. It was because of this that the duty was paid under prote....
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....ayable under Chapter 21 and paid under Chapter 24, in each of the invoices issued for removal of goods." 12.2 To this important issue raised by the assessee, counsel for the Revenue could raise no legal dispute. As pointed out by the assessee and as accepted by the Tribunal and not controverted by the learned counsel for the Revenue, when the assessee even though under compulsion was clearing the goods under certain sub-heading of Excise Tariff and which notify a certain rate of Excise duty, he had to declare such clearance and rate of duty in the invoices failing which, there would be a mis-match between what the assessee was depositing with the Department by way of Excise duty and additional duties and what would be indicated in the invoices. If that be so, simply because the invoice of the period in question indicated excise duty at the rate of 16% would not in any manner mean that the assessee passed on such duty in its entirety to the consumer. Answer to this crucial question had to be found from other sources and evidence. 12.3 In view of over-whelming evidence on record suggesting that the assessee had not passed burden of additional duty to the consumers, ....
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....ent case, we find that considering additional material on record, the assessee, as held by the Tribunal, had succeeded in establishing that the burden of higher duty was not passed on to the consumers. The Deputy Commissioner and Commissioner both simply brushed aside the evidence on record by holding that merely because the price structure has not changed, the burden on the assessee cannot be stated to have been discharged. When we find that in addition to such constant price structure there were other factors having a bearing on the issue, the said authorities could not have rejected the refund claim. The assessee having discharged the burden of establishing the necessary requirement, if the Departmental authorities desired to examine the issue from any other angle or required additional material to satisfy whether the uniformity in the price structure is attributable solely to the assessee absorbing the additional burden of duty or on some other fortuitous circumstances independent of the question of the assessee absorbing such burden, the authority could and ought to have made further inquiries with the assessee. 13. We further find that the Commissioner (Appeals) relied upo....