Custom, Excise & Service Tax Tribunal
Cce, Aurangabad / vs Goodyear South Asia Tyres Pvt. Ltd. / on 16 June, 2015
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH AT MUMBAI COURT NO. I Appeal No. E/1159, 1224/09-Mum [Arising out of Order-in-Appeal No. AGS(194)84/09 dated 26.08.2009 passed by the Commissioner, Central Excise & Customs, Aurangabad]. For approval and signature: Honble Shri M.V. Ravindran, Member (Judicial) ======================================================
1. Whether Press Reporters may be allowed to see : No the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? 2. Whether it should be released under Rule 27 of the : No CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? 3. Whether their Lordships wish to see the fair copy : Seen of the order? 4. Whether order is to be circulated to the Departmental : Yes authorities? ====================================================== CCE, Aurangabad / Goodyear South Asia Tyres Pvt. Ltd. Appellants Vs. Goodyear South Asia Tyres Pvt. Ltd. / CCE, Aurangabad Respondents Appearance: Shri H. M. Dixit, A.C. (AR) for Appellants Shri Rajesh Oslwal for Respondents CORAM: HONBLE SHRI M.V. RAVINDRAN, MEMBER (JUDICIAL) Date of Hearing: 16.06.2015 Date of Decision: 16.06.2015 ORDER NO. Per: Shri M. V. Ravindran, Member (Judicial)
1. These two appeals are disposed of by a common order as revenue and assessee both are in appeal against Order-in-Appeal No. AGS(194)84/09 dated 26.08.2009.
2. The revenue is aggrieved by the impugned order on the ground that the first appellate authority has allowed the appeal filed by the assessee for refund an amount of Rs.35,91,361/-, while assessee is aggrieved by the order rejecting refund claim of Rs.4,39,002/-.
3. Heard both sides and perused the records.
4. The issue involved in this case is that the assessee appellant had filed a refund claim of Rs.71,78,191/- under Sec. 11B of the Central Excise Act, 1944 with the department on the ground that they had paid excess central excise duty in terms of the price revision clause as be the agreement with purchasers. The adjudicating authority rejected the refund claims. On an appeal, the first appellate authority after going through the entire case records came to a conclusion that appellant assessee is eligible for a refund of Rs.35,91,361/- and ineligible for refund claim of Rs.4,39,002/-. For coming to such a conclusion, he recorded the following findings:
I have carefully gone through the appeal book and submissions made by the appellants. From the records it has been observed that the refund in the instant case was arisen out of the retrospective price revision made by M/s Goodyear India Ltd., Ballabhgarh (Haryana) for the finished goods purchased from the appellant i.e. M/s Goodyear South Asia Tyres Pvt. Ltd., Aurangabad in terms of the Off Take Agreement dtd. 01.09.2001 which contains the price variation clause, where there is a provision for both upward and downward revision of the prices depending upon the market conditions. Appellant have raised credit note to M/s Good year India Ltd. for different value due to revision of price at down side and filed the refund claim accordingly. The original adjudicating authority has allowed refund of Rs. 35,91,361/- but amount had been ordered to be credited to the consumer welfare fund under the provisions of Section 12C of Central Excise Act, 1944 and refund for Rs. 4,39,002/- was rejected being time barred. It is an accepted fact by respondent that the appellant has issued credit note to their buyer. In accounting procedure, when a credit note is issued the amount gets credited to the account of one to whom the credit note is issued. It means that one who has issued the credit note has paid that amount to one who has received the credit note. In the instant case, the appellant has issued the credit note to its buyer. It means, the appellant has refunded the money to that extent to the buyer due to downward revision of price. It means that, after issue of credit note, the transaction value has been reduced. The reduced transaction value is cum duty price. The duty was paid taking higher transaction value into consideration whereas actual transaction value is less. It results in claiming refund. When less value is collected from buyer, it can not be said that the duty burden has been passed on. It is because, duty is the component of the price of the goods received by the manufacturer. The buyer has not shared the burden of that duty component which is constituent of that price which is not paid by the buyer. The case law reported in 2003 (161) ELT 460 (Tri.-Chennai) in the case of CCE, Chennai V/s Addison & Co. Ltd. squarely covers the issue involved in this case. Therefore appellant is entitled for refund of Rs. 35,91,361/- under Sec. 11B of Central Excise Act, 1944. Regarding refund for Rs. 4,39,002/- the order passed by the adjudicating authority is correct and therefore I do not interfere with this part of rejecting the same being time barred.
5. It is the case of revenue that the appellate authority is in errors as credit note issued by the appellant cannot be considered as not passing of incidence of duty. Ld. D. R. would rely upon the following decisions:
(A) TVS Motor Company Ltd. V/s CCE, Chennai-III - [2014(303) ELT 520 (Mad.)] (B) CCE, Madurai V/s Vanithamani Chemicals Pvt. Ltd. - [2009(238) ELT 492] (C) Ballarpur Industries Ltd. V/s CCE, Bhubneshwar - [2005(184) ELT 67]
6. Ld. Advocate appearing on the behalf of assessee would draw my attention to the decision of Honble High Court of Madras in the case of Addison & Co. Ltd. V/s CCE 2001 (129) ELT 44 (Mad.) and Union of India V/s A.K. Spintex Ltd. 2009 (234) ELT 41 (Raj.), AP Papers Ltd. V/s CCE, Vishakhapattanam 2014 (306) ELT 344 (A.P.).
7. I have considered the submission made at length by both sides and perused the records.
8. As regards the appeal filed by assessee M/s Goodyear South Asia Tyres Pvt. Ltd., I find that the said appeal needs to be rejected and both the lower authorities were correct in coming to a conclusion that refund claim of Rs.4,39,002/- is time barred. It is seen from the records that the assessee had issued credit note in March 2003 and refund claim is filed on 5th April, 2004 which is beyond the period of 12 months as mandated in Sec. 11B of the Central Excise Act, 1944. In view of the forgoing appeal filed by the appellant assessee (Appeal No. E/1224/09) is rejected.
9. As regards the appeal filed by the revenue, I find that the grounds taken by the revenue in the appeal memoranda that the first appellate authority has relied upon the judgment of the Madras High Court in the case of Addison & Co. Ltd. is incorrect, as the matter is contested in the Supreme Court; the amount claimed as refund will be enriching the assessee unjustly, in as much that the assessees purchasers might have collected the amount from customers. The reasoning put forth by the learned departmental representative will not carry the case of revenue any further as the findings of first appellate authority (as reproduced here in above) are not contested. The issuance of credit note by the assessee is not disputed. If that be so the judgment of Honble High Court Rajasthan in the case of A.K. Spintex Ltd. (Supra) is directly on the point. It is to be recorded that the judgment of Honble High Court of Andhra Pradesh in the case of A.P. Papers Mills Ltd. (Supra) also covers the issue in favour of the assessee, as to that refund claim filed by an assessee, he has to only satisfiy the provision of Sec. 11B of the Central Excise Act, 1944 and not any further. I find that in the case in hand, the appellant has satisfied all the requirements of provision of Sec. 11B of the Central Excise Act, 1944. In view of forgoing appeal filed by the revenue of devoid of merits, the appeal is rejected.
10. Both the appeals are disposed of as indicated herein above.
(Dictated in Court)
(M.V. Ravindran)
Saifi Member (Judicial)
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