Custom, Excise & Service Tax Tribunal
Cce, Jaipur-I vs M/S. Man Industrial Corporation on 18 August, 2015
IN THE CUSPTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, NEW DELHI, PRINCIPAL BENCH NEW DELHI
Date of Hearing/ Decision:18.08.2015
Excise Appeal No.E/2772/2006-EX(DB)
[Arising out of Order-in-Appeal No.178(MPM)CE/JPR-I/2006 dated 23.05.2006 passed by the Commissioner of Central Excise (Appeal-I), Jaipur].
CCE, Jaipur-I Appellant
Vs.
M/s. Man Industrial Corporation .Respondent
Appearance:
Rep. by Shri Pramod Kumar, Joint CDR for the appellants.
Rep. by Shri Maynak Garg, Advocate for the respondent.
For approval and signature:
Honble Shri Ashok Jindal, Member (Judicial) Honble Shri B. Ravichandran, Member (Technical) 1 Whether Press Reporters may be allowed to see 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 CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? 3 Whether Their Lordships wish to see the fair copy of the Order?
4 Whether Order is to be circulated to the Departmental authorities? Coram: Honble Shri Ashok Jindal, Member (Judicial) Honble Shri B. Ravichandran, Member (Technical) Final Order No. 52742/2015 dated:18.08.2015 Per Ashok Jindal:
The Revenue is in appeal against the impugned order wherein the ld. Commissioner (Appeals) has allowed the refund claim filed by the respondent holding that the respondent has passed the bar of unjust enrichment.
2. The facts of the case are that the respondent filed a refund claim on the ground that the duty has been wrongly collected from them on the forged products under Tariff Item No.68 instead of Tariff Item No.26 AA(ia), which was correct classification of those goods. The respondent has contended that the goods were cleared on payment of duty from their factory @ 8% Adv under protest during the period 26.10.1979 to 19.08.1982. The duty paid by the respondent was accepted by the then Asstt. Collector of Central Excise but on appeal before the Collector (Appeals), it was held that the respondent is not required to pay the duty. Thereafter, the respondent filed refund claim of the duty paid under protest. The adjudicating authority sanctioned refund claim but held that the respondent has failed to pass bar of unjust enrichment, therefore, refund claim was rejected. On appeal before the ld. Commissioner (Appeals), who observed that the respondent has passed on the bar of unjust enrichment to the buyers of the goods and the buyer of the goods have issued debit notes to the respondent, therefore, they have not passed on the duty on the buyers. Consequently, the refund claim was sanctioned. Aggrieved from the said order, the Revenue is before us.
3. Ld. Authorised Representative submits that in this case, initially, the respondent paid the duty under protest but the same was collected from the buyers and the buyers took cenvat credit of the duty paid by the respondent. These facts are not in dispute. Thereafter, it was held that the respondent was not required to pay duty. The respondent filed refund claim and the buyers has issued debit notes without reversing the cenvat credit. In that circumstances, the respondent has not passed the bar of unjust enrichment, therefore, the impugned order is to be set aside. To support his contention, he relies on the decisions of the Tribunal in the case of CCE, Ludhiana Vs. Oriental Textile Processing Co.(P) Ltd. reported in 2012 (276) ELT 257(Tribunal-Delhi).
4. On the other hand, ld. Counsel for the respondent submits that as the buyers of the respondent has issued debit notes to the respondent, therefore, the respondent has not collected any duty from the buyers. Consequently, the refund claim was rightly sanctioned by the ld.Commissioner (Appeals). He further submits that the debit notes issued by the consignee is sufficient to show that the burden of duty has not been passed on to the consignee. In support of his contention, he relies on the decision of the Tribunal in the case of CCE, Belgaum Vs. Jineshwar Malleable & Alloys reported in 2012 (281) ELT 43 (Karnataka). He also relies on the decision of the Tribunal in the case of ACME Diet Care Pvt. Ltd. Vs. CCE, Ahmedabad reported in 2009 (241) ELT 257 (Tribunal-Ahmd.) and in the case of Om Pharmaceuticals Ltd. Vs. CCE, Bangalore reported in 2008 (232) ELT 309 (Tribunal-Chennai).
5. Heard the parties. Considered the submissions.
6. In this case, the fact of the case are as under:-
7. The appellants paid duty under protest and burden of duty passed on to the buyers at the time of issuance of invoices. The buyers also took cenvat credit thereof and have not reversed the credit while issuing debit notes to the respondent.
8. As these facts are not in dispute by mere issuing debit notes, the respondent is not able to discharge the burden of unjust enrichment. Further, same view has been affirmed by this Tribunal in the case of Oriental Textile Processing Co.(P) Ltd. (supra), wherein , this Tribunal has held as under:-
5.?The appeal filed against connected matter involving similar issue was dismissed by the Apex Court and that is reported in Rajasthan Processors (India) Ltd. v. Collector - 1994 (70) E.L.T. A182 as well as in Rajasthan Spinning & Weaving Ltd. v. Collector - 1999 (112) E.L.T. A115 (S.C.). Once the law having been clearly laid down that mere issuance of the credit notes or debit notes subsequent to the collection of the duty incidents in terms of the invoices issued at the time of the sale of the goods do not amount to discharging the burden which is required to be discharged by the assessee, to come out of the principle of unjust enrichment applicable in such cases, merely because the buyers of the respondent had issued the debit notes and had made reference to such debit notes in their ledger books that itself cannot be sufficient to say that the respondent had discharged their burden in that regard. The appellants, therefore, are justified in contending that consequent on the failure on the part of the respondent to establish the duty incident has not been passed over to the customers, the authorities below erred in dropping the proceedings. Being so, the order passed by the authority below are not sustainable and are liable to be set aside with consequential relief. Accordingly, the appeal succeeds. The impugned order along with the order of the Adjudicating Authority is set aside with consequential relief.
9. We also find that the ld. Counsel for the respondent has relied on the decision in the case of Jineshwar Malleable & Alloys (supra). The facts of that case are not applicable to the facts of this case as in that case, the observation of the Honble High Court that the consignee has reversed the amount of cenvat credit but in this case, it is an admitted fact that the buyer has not debited cenvat credit along with the amount of duty in dispute as claimed by the respondent as a refund. Further, the decision in the case of ACME Diet Care Pvt. Ltd. (supra) and Om Pharmaceuticals Ltd. (supra) are of Single Member Bench whereas the decisions in the cases of Oriental Textile Processing Co.(P) Ltd. (supra) is of Double Member Bench, which is binding on us. In the circumstances, relying on the decision in the case of Oriental Textile Processing Co. (P) Ltd. (supra), we hold that the ld. Commissioner (Appeals) is in error in holding that the respondent has passed unjust enrichment. Therefore, the impugned order is set aside. The appeal is allowed with consequential relief, if any.
[operative portion of the order already pronounced in the court] ( Ashok Jindal ) Member (Judicial) ( B. Ravichandran) Member (Technical) Ckp.
1