Custom, Excise & Service Tax Tribunal
Visakhapatnam-I vs Hindustan Shipyard Ltd on 20 January, 2020
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
HYDERABAD
REGIONAL BENCH - COURT - I
Central Excise Appeal No. 2497 of 2010
(arising out of order-in-Appeal No. 49/2010(V-I)CE dated 20.08.2010 passed by
Commissioner of Central Excise & Customs (Appeals) Visakhapatnam)
The Commissioner of Central Excise,
Visakhapatnam-I Commissionerate,
Appellant
Central Excise Building, Port Area,
Visakhapatnam 530 035
Versus
Hindustan Shipyard Ltd
Respondent
Gandhigram, Visakhapatnam Appearance:
Mr. N. Bhanu Kiran A.R. for the Appellant Mr. S. Thirumalai, Adv for the Respondent.
CORAM HON'BLE Dr. D.M. Misra, Member(Judicial) HON'BLE Mr. P. Venkata Subba Rao, Member (Technical) FINAL ORDER No. 30251/ 2020 Date of Hearing: 20/01/2020 Date of Decision: 20/01/2020 [ORDER PER:Dr D.M. MISRA] .
This is an appeal filed against order-in-appeal No 49/2010 (V-I) CE passed by Commissioner of Central Excise (Appeals) Visakhapatnam. 2
2. Briefly stated, the facts of the case are that respondent a Public Sector undertaking are engaged in the manufacture of goods falling under Chapter 89 of Central Excise Tariff Act 1985. They have constructed a platform for ONGC, Mumbai consisting of jackets and decks for functional utility of the platform. The respondent requested provisional assessment of the manufactured goods which was allowed on 16.03.1995. Thereafter, the respondent through their letter dated 27.06.1996 submitted the final price for decks and also for jackets. The Assistant Commissioner accepted the final value of jackets submitted by the respondent and finalised the assessment by an order dated 9th May 2003. In respect of decks the Assistant Commissioner finalised the assessment on 12.02.2008, recalculated the duty payable by the respondent on the jackets and arrived at the finding that the respondents were liable to pay Rs 25,13,62,463/- against the duty already paid i.e. Rs 26,28,14,000/-. Consequently the respondent had claimed refund of the excess duty paid amounting to Rs 1,14,51,537/- on 08.12.2008. The adjudicating Assistant Commissioner sanctioned the refund but directed the same to be credited to the consumer welfare fund as per amended Section 11B(2) read with Section 12C of Central Excise Act 1944. Aggrieved by the said order the they filed appeal before the learned Commissioner (Appeals) who in turn set aside the order of the adjudicating authority and observed that the respondents are entitled for refund of the duty. Hence, the Revenue is in appeal.
3. Learned A.R. for the Revenue reiterating the grounds of appeal has submitted that since finalisation of provisional assessment was consequent to the issue of Notification No. 30/2001 CE(NT) dated 20th June 2001, the doctrine of unjust enrichment is clearly applicable in the instant case. It is his contention that the case laws referred to and relied upon by the learned 3 Commissioner (appeals) relates to the period prior to amendment to Rule 9B of Central Excise Act 1944. Further he has submitted that the observation of the learned Commissioner (Appeals) that the respondent being Public Sector Undertaking, the issue of unjust enrichment not applicable is contrary to the judgement of the Hon'ble Supreme Court in the case of Mafatlal Industries Vs UOI [1997(89)ELT 247(SC). Therefore the order allowing refund is unsustainable in law.
4. Learned advocate Shri S. Thirulamai for the respondent has submitted that the assessment was provisional way back in the year 1995 and all requisite documents for finalisation of assessment were furnished by the respondent in the year 1996 i.e. much before the amendment to Rule 9B(5) under Notification No. 45/99 CE (NT) dated 25.06.1999, whereby the provisions of unjust enrichment stipulated under Section 11B(2)of Central Excise Act are made applicable to cases of provisional assessment also. It is his contention that the amendment brought under the Notification No. 30/2001 CE(NT) dated 26.01.2001 has no relevance and applicability to the facts of the present case. It is his contention that principles of unjust enrichment on finalisation of provisional assessment prior to amendment is not applicable to the assessment that were provisional prior to the amendment. Thus, even though the finalisation of assessment in their case was completed in the year 2008, therefore the principles of unjust enrichment would not be applicable to their case. In support he has referred to the following judgements.
1) CCE Mumbai III Vs CEAT Ltd [2018-TIOL-976-HC-MUM-CX]
2) CCE Bengalure-I Vs Indian Telephone Industries Ltd [2018-TIOL-1279-
HC-KAR-CX] 4
3) CCE Chennai Vs TVS Suzuki Ltd [2003 (156)ELT 161(SC)]
4) 4) CCE & ST Vadodara-II Vs Panasonic Battery India Co. Ltd [2014(303)ELT 231 (Tri-LB Ahmedabad)]
5) CCE Hyderabad II Vs VST Industries Ltd [2018-TIOL-3000-CESTAT- Hyd)]
5. Heard both sides and perused the records. The short issue involved in the present appeal for consideration is whether the principles of unjust enrichment to the provisional assessment in the year 1995 would be applicable on finalisation of assessment in 2008. We find that this issue has been resolved by the Hon'ble Bombay High Court in CEAT Ltd case (supra). Their Lordships after analysing the amendment and the principles of law on the subject observed as follows:
"16. In view of the settled position of law, it is clear that the entitlement to refund and finalisation of the provisional assessment under Rule 9B of the Central Excise Rules, 1944 is independent from the provisions of refund under Section 11B of the Central Excise Act,1944. Even if the amendment made by the notification 45/99 with effect from 25.06.1999, is noted, only the procedure established under subsection 2 of section 11B of the Central Excise Act has been made applicable to the refund arising out of the finalization of the provisional assessment under Rule 9B of the Central Excise Rules, 1944. The procedure regarding unjust enrichment of finalization of provisional assessment will be applicable to the provisional assessment made after 1999 and not before that date as the proviso to Rule 9B in the form of sub Rule 5 did not have a retrospective effect. The doctrine of unjust enrichment therefore would not be attracted prior to 1999 and sub Rule 5 to Rule 9 B of the Central Excise Rule, 1944 will not operate retrospectively. The proviso to Rule 9B(5) would be made applicable only with effect from 25.06.1999 and therefore the principle of unjust enrichment cannot be made applicable to the refunds arising out of finalization of the provisional assessments pertaining to the period prior to 25.06.1999 even if the assessments are finalized after 25.06.1999."
It is not in dispute that the provisional assessment was directed in the year 1995 and relevant documents for finalisation of claim have been submitted in the year 1996. The department finalised the assessment only in the year 2008. In these circumstances applying the above ratio of the Bombay High Court, we are of the view that principles of unjust enrichment would not be 5 applicable to the refund filed consequent to finalisation of provisional assessment initiated in the year 1995. In the result, the impugned order is upheld and Revenue's appeal being devoid of merits is accordingly dismissed.
(Operative portion of the Order pronounced in open court on conclusion of the hearing ) (Dr. D.M. Misra) Member (Judicial) (P. Venkata Subba Rao) Member (Technical) neela reddy