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Judgment
Feeling aggrieved with the impugned order dated 28.02.2007, both the assessee as well as Revenue have preferred appeals before this Tribunal.
Brief facts of the case are that the appellant is a manufacturer of edible oil, falling under Chapter 15 of the Central Excise Tariff Act, 1985. On
01.09.1984, the appellant had filed the classification list in terms of the erstwhile Central Excise Rules, 1944 claiming that no duty is payable on refined
oil, since the activity of refining of edible oil is not a process of manufacture. Classification of the product was disputed by the Department. The
classification dispute was agitated before various judicial forums. The Department insisted for payment of Central Excise duty vide letter dated
04.03.1991. Pursuant to such letter, the assessee had deposited the disputed amount on 08.02.1992 and 10.02.1992. After protracted litigation, the
issue was finally resolved by the Hon’ble Supreme Court vide their judgment dated 23.11.2004 in favour of the assessee. Pursuant to the
favourable judgment, the assessee had filed the refund application before the Jurisdictional Central Excise authorities on 21.02.2005, claiming refund of
Rs.1,00,86,798/-. The said refund application was returned by the Department to the assessee on 06.04.2005, stating that the application suffers from
some discrepancies. Thereafter, the assessee had re-submitted the refund application, which was adjudicated on 23.05.2006 in rejecting the claim of
the assessee on the grounds of limitation as well as on unjust enrichment. The assessee had preferred appeal before the Commissioner (Appeals).
However, the amount of Rs.95,51,165/- was forgone by the assessee in the appeal before the Commissioner (Appeals). Thus, the net effect of the
refund claim was Rs.5,35,633/-. The Commissioner (Appeals) vide the impugned order, dated 28.02.2007 has allowed the appeal of the appellant on
limitation aspect, but rejected the same on the ground of unjust enrichment. Against the impugned order both the Revenue as well as the assessee
have filed appeal before the Tribunal.
The grievance of Revenue is that allowing the appeal of assessee on the ground of limitation is not proper and justified inasmuch as the refund claim
was filed on 23.05.2006, pursuant to the judgment dated 23.11.2004 of Hon’ble Supreme Court, which is beyond one year from the relevant date
prescribed under Section 11B of the Central Excise Act, 1944. The assessee has contested the impugned order on the ground that the doctrine of
unjust enrichment is not applicable to the facts of the case, for the reason that clearances of the excisable goods were effected between 01.09.1984 to
28.02.1986 and in the corresponding invoices, no Central Excise duty had been charged and collected from the buyers of the goods. Further contention
of the assessee is that since the duty attributable to the goods cleared during 1984-1986 was deposited by the appellant in 1992, there was no scope or
occasion for passing on the incidence of the duty to the buyers of the goods. The other submission of the assessee is that the Central Excise duty
amounting to Rs.5,35,633/- has been shown in the balance sheet as claims receivable from the Department, and thus, the incidence to the extent of the
refund claim amount has been borne by the assessee.
I have heard the Ld. Counsel for both the sides and perused the records.
It is an admitted fact that the refund application initially filed on 21.02.2005 was returned by the Department under the cover of Letter dated
06.04.2005, showing certain discrepancies in the claim application. The said application though was re submitted on 23.05.2006, such date will not be
taken as the relevant date for the purpose of consideration of the limitation period provided under section 11B of the Act, in view of the fact that
Section 11B, nowhere mandates that the refund claim has to be returned by the Central Excise Officers. Sub-section (2) of Section 11B provides that
on receipt of any application, the Assistant Commissioner or the Deputy Commissioner, it is satisfied that the whole or any part of the duty of excise is
refundable, then he has to make an order on such refund application. On perusal of the statutory provision, it reveals that nowhere there is no mention
that the application has to be returned to the assessee. In this case, initially refund application was filed on 25.02.2005, which is within the limitation
period from the date of Hon’ble Supreme Court judgment dated 23.11.2004. Thus, I am of the view that refund application is not barred by
limitation of time. Hon’ble Gujarat High Court in the case of United Phosphorus Ltd. vs UOI-2005 (184) ELT 240 (Guj. )have held that once
refund application has been filed before the concerned authority, such authority cannot part with by returning the same. The relevant paragraph in the
said judgment is extracted below.
“4. The impugned order returning the application of the petitioners for refund of claim is, therefore, illegal and void and is liable to be
set aside only on the ground that it was the duty of the Assistant Commissioner to have considered the claim application and made an order
thereon under the provisions of Section 11B of the Act, and the relevant rules. The impugned order dated 10-1-2003 is, therefore, hereby
set aside with a direction that on presentation by the petitioners of the original application dated 20-12-2002 which was returned to them
under the impugned order, that application shall be taken on record by the Assistant Commissioner and it shall be duly considered and an
appropriate decision be taken thereon in accordance with law after giving adequate opportunity to the applicant to furnish proof, if any, in
support of his claim. Rule is made absolute accordingly with no order as to costs.â€
Further, this Tribunal in the case of Commissioner of Service Tax Mumbai vs Reliance Communication Ltd.-2008 (11) STR 258 (Tri. Mum) has
held that if the returned application is resubmitted later, the initial date of filing should be construed as the date of filing the refund application. In view
of the above, I am of the considered opinion that there is no infirmity in the impugned order so far as allowing the appeal of assessee on the ground of
limitation is concerned. Therefore, I dismiss the appeal filed by the Revenue.
With regard to unjust enrichment, it is evident from record that at the time of clearance of goods to the buyers during the period 1984-1986, the
assessee had not charged any Central Excise duty in the invoices issued by it. The amount of disputed duty was deposited in the year 1992 pursuant to
the letter dated 04.03.1991, issued by the Jurisdictional Central Excise authorities. Since the duty amount had not been charged or claimed in the
invoices, it cannot be said that the incidence has been passed on to the buyer of the goods. In this context, I find that the Hon’ble Punjab &
Haryana High Court in the case of Commissioner of Central Excise Chandigarh-I vs Modi Oil and General Mills-2007 (210) ELT 342 (P&H h)ave
held that incidence of duty could not be transferred to buyer after date of clearance, as duty had been paid on subsequent date, thus presumption
raised under Section 11B in the Central Excise Act, 1944 is rebutted by the assessee. Further I find that in the balance sheet as on 31.03.1992, the
appellant had shown the disputed duty under the head “current assets, loans and advanceâ€, showing the narration as Central Excise duty paid
under protest. The accounting entry made in the balance sheet proves beyond any shadow of doubt that the incidence of disputed duty had been borne
by the assessee and not passed on to any other person. Hence, the doctrine of unjust enrichment is not applicable in the facts and circumstances of
the present case. Therefore, I do not find any merits in the impugned order so far as rejected the appeal of the assessee on the ground of unjust
enrichment is concerned. Accordingly, after setting aside the impugned order, I allow the appeal in favour of the assessee.
The appeals are disposed of in above terms.
(Dictated and pronounced in open court)