Custom, Excise & Service Tax Tribunal
Hindustan Copper Ltd vs Kandla on 19 June, 2018
In The Customs, Excise & Service Tax Appellate Tribunal
West Zonal Bench At Ahmedabad
Appeal No. C/140/2009-DB
Appeal No. C/358,416/2011-DB
[Arising out of OIA-08-2009-CUS-COMMR-A--KDL dated 29.01.2009 passed by Commissioner of Central
Excise, Customs and Service Tax -Kandla]
[Arising out of OIA-151-2011-CUS-COMMR-A--KDL dated 20.04.2011 passed by Commissioner of Central
Excise, Customs and Service Tax -Kandla]
M/s Hindustan Copper Ltd Appellant
Hindustan Copper Ltd
C.C.Kandla
Vs
C.C.Kandla Respondent
C.C.Kandla Hindustan Copper Ltd Represented by:
For Appellant: Shri P. M Dave (Manager) For Respondent: Shri J. Nagori (A.R.) CORAM:
HON'BLE MR. RAMESH NAIR, MEMBER (JUDICIAL) HON'BLE MR. RAJU, MEMBER (TECHNICAL) Date of Hearing/Decision:19.06.2018 Final Order No. A/ 11269-11271 /2018 Per: Ramesh Nair The brief facts of the case are that the appellant have imported consignments of copper concentrate under Chapter heading 74 of Customs Tariff Act, 1975. They filed bill of entry. The department assessed the bills of entry provisionally and consequent to the finalization of assessment, some duty was found to have been paid in excess and interest was also demanded for the period from the date of provisional assessment of the bill of entry till the date of adjustment of excess/ short paid duty. The amount which was found to be paid in excess was credited into consumer welfare fund. He appellants filed appeals against the final assessment order challenging the credit of
2|Page C/416,358/2011 & C/140/2009-DB refundable amount into consumer welfare fund and also challenging the demand of interest. The Ld. Commissioner (Appeals) upheld the order of the lower authority crediting the refund amount into consumer welfare fund. However, dropped the demand of interest upto the period of 13.07.2006. Being aggrieved by the orders in appeal, the assessee filed appeals in respect of the refund which was credited into consumer welfare fund. The Revenue filed appeal challenging the dropping of interest by the Commissioner (Appeals) up to the period of 13.07.2006.
2. Sh. P. M. Dave, Ld. Counsel appearing on behalf of the appellant submits that the appellant is a Government of India Enterprise and suffering heavy losses. The price of the goods manufactured by the assesse is not based on the cost of the product but it is based on the price prevailing in LME, therefore, the question of unjust enrichment in the facts of the appellants does not apply. He alternatively submits that since the appellant was under bonafide belief that as per the peculiar fact of pricing of the appellant's goods, the provision of unjust enrichment is not applicable, therefore, documents such as balance sheet, ledger to establish that the incidence of duty paid during the provisional assessment was not passed on to any other person could not be submitted before both the lower authorities, therefore, the factual aspect of unjust enrichment was yet to be verified. As regard Revenue's appeal which seeking demand of interest on the delay in making the payment of customs duty for the period prior to 13.07.2006, he submits that specific provision for interest on payment of duty under Provisional assessment was brought into section 18 by inserting sub section (3) w.e.f. 13.07.2006. Therefore, for the period prior to 13.07.2006 the Commissioner has rightly dropped the demand as there was no
3|Page C/416,358/2011 & C/140/2009-DB provision for interest in case of provisional assessment. He relied on the following case laws:
CC vs Hindalco Industries Ltd. 2008 (231) ELT 36 (Guj.) Mangalore Refinery & Petrochemicals Ltd. vs CCE Mangalore 2015 (323) ELT 484 (Kar.) Commr. vs R.L. Kalathia Ship Breaking Pvt. Ltd. 2016 (338) ELT A76 (SC) Chemsilk Commerce (P) Ltd. vs CC Kolkata 2009 (233) ELT 113 (Tri. Kolkata) Sterlite Industries (I) Ltd. CC Tuticorin 2008 (223) ELT 633 (Tri.
Chennai) Amadalavalasa Cooperative Sugars Ltd. vs CCE Vishakhapatnam 2009 (15) STR 501 (Tri. Bang) Uniproducts (I) Ltd. vs CCE Delhi-III 2004 (170) ELT 299 (Tri. Del) Lorenzo Bestonso Vs CC JNCH 2017 (347) ELT 104 (Tri.Mum) South Eastern Coal Fields Ltd. vs CC Bhopal 2018 (8) GSTL 51 (Tri.Del)
3. On the other hand, Sh. J. Nagori, Ld. Additional Commr. (AR) appearing on behalf of the Revenue in respect of the assessee's appeal submits that every refund has to pass the test of unjust enrichment, therefore, the unjust enrichment is applicable. Since the assessee have not established that the incidence of duty was not passed on to any other person by submitting the necessary documents, the refund amount was rightly credited into consumer welfare fund. As regards, the Revenue's appeal, he submits that the specific provision for interest by insertion of sub Section 3 of Section 18 came into effect from 13.07.2006 but general provision of interest under Section 28AB was
4|Page C/416,358/2011 & C/140/2009-DB existing during the relevant period, therefore, in terms of Section 28AB, the assessee was required to pay the interest.
4. We have carefully considered the submissions made by both the sides and perused the records. We find that as regards the assessee's appeal on the issue of unjust enrichment, the fact that whether the incidence of excess paid duty was passed on or otherwise has not been established for the reason that the assessee have not produced the necessary documents before both the lower authorities. In these circumstances, in our considered view, an opportunity can be given to the assesse to produce all the documents before the adjudicating authority to establish that whether the incidence of excess paid duty during the provisional assessment was passed on to any other person. Accordingly, assessee's appeals are allowed by way of remand to the adjudicating authority for passing a fresh order. As regard Revenue's appeal, we find that in case of provisional assessment, there is a specific provision for payment of duty etc. under Section 18. Before 13.07.2006, there was no provision for interest in case of any duty stand payable on finalization of the provisional assessment. Therefore, in case of provisional assessment being finalized, Section 28AB is not applicable. When Government realized that there should be a provision of interest even in case of provisional assessment when it is finalized a specific provision by inserting sub Section (3) was made in Section 18 of the Customs Act, 1962. Therefore, we are in agreement with the Ld. Commissioner (Appeals) who set aside the demand of interest for the period prior to 13.07.2006. This issue has also been dealt with by this Tribunal in the case of Chemsilk Commerce (P) Ltd. vs CC Kolkata, wherein it was held that in case of provisional assessment the interest was not chargeable prior to 13.07.2006. Accordingly, we do not find
5|Page C/416,358/2011 & C/140/2009-DB any error in the order of the Commissioner (Appeals) inasmuch as, he dropped the demand of interest for the period up to 13.07.2006. Accordingly, the Revenue's appeal does not survive, hence dismissed. The assessee's appeals are allowed by way of remand.
(Dictated and pronounced in the open court)
(Raju) (Ramesh Nair)
Member (Technical) Member (Judicial)
Neha