Custom, Excise & Service Tax Tribunal
Arising Out Of Order-In-Appeal No. ... vs Commissioner Of Central Excise, ... on 28 January, 2014
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL SOUTH ZONAL BENCH BANGALORE Final Order No. 20118-20119 / 2014 Appeal(s) Involved: E/26875/2013-SM E/212/2012 [Arising out of Order-in-Appeal No. 27/2013 (H-III) CE dated 22/03/2013 passed by Commissioner of Central Excise, Customs & Service Tax (Appeals) Hyderabad] Linkwell Telesystems Pvt Ltd B-45, Electronics Complex, Kushaiguda, HYDERABAD AP-500062 Appellant(s) Versus Commissioner of Central Excise, Customs And Service Tax - HYDERABAD-III OPP LB STADIUM ROAD, BASHEERBAGH, HYDERABAD, ANDHRA PRADESH-500004 Respondent(s)
Appearance:
Mr. B. Venugopal, Adv G-8, FORTUNA ICON, APARTMENTS,JODIDAR ASHWATHAPPA FARM, SAHAKARA NAGAR, BANGALORE 560 092 For the Appellant Mr. A.K. Nigam, A.R. For the Respondent CORAM:
HON'BLE SHRI B.S.V.MURTHY, TECHNICAL MEMBER Date of Hearing: 28/01/2014 Date of Decision: 28/01/2014 Brief facts of the case are that the respondents M/s Linkwell Telesystems Pvt. Ltd. engaged in the manufacture of various telecommunication equipments and supply finished goods and parts to the telecom service providers, took CENVAT credit on parts purchased. It was investigated by the DGCEI that the respondents were clearing the spare parts without reversing the credit taken by them in the CENVAT Registers. In this connection, two show cause notices were issued to the respondents one bearing No. 18/2009-10 dt 11.05.2009 for a demand of Rs. 1,69,416/- and another No. 28/09-10 dt 26.06.2009 for Rs 99,00,230/-. In total, the demand amount is Rs. 1, 00, 69,646/-. The respondents paid Rs. 1,01,45,447/- in 2008 itself along With interest and consequent on issuing of the show cause notices, they admitted an amount of Rs 95,08,708/- and filed an application for settlement of the case praying for granting immunity from imposition of penalty, prosecution and fine under Central Excise Act, 1944. The Settlement Commission Bench after considering the fact of making payment of the amounts even before the issuance of the show cause notices and taking other credentials in to consideration settled the case vide Final Order No. 05/2010-CEX dt 12.08.2010 under the following terms and conditions:
* The additional amount of Central Excise duty is settled at Rs 95, 08,708/-. Sine this amount has already been paid, no further liability subsists in this regard.
* The interest amount is settled at Rs. 17, 21,627/-. Since this amount has been paid no further liability subsists.
* Immunity from fine is granted to the assesses under Sec. 32K(1) of the CE Act, 1944 * Immunity from penalty is granted to the assessees under Sec. 32K(1) of the CE Act, 1944 * Immunity from prosecution under Sec. 32K (1) of the CE Act, 1944 is granted to the assessee.
Consequent of the Final Order dt 12.08.2010 of Settlement Commission, the assessee filed an application seeking refund of Rs. 6, 36,739/- being the excess paid amount. The Refund sanctioning authority i.e. Jurisdictional Assistant Commissioner sanctioned Rs. 6,36,739/- as credit in the CENVAT account, in full and final settlement of the claim under Section 11B of the Central Excise Act, 1944.
2. Aggrieved by this order, the department filed an appeal before the Commissioner (Appeals) on the ground that the original adjudicating authority had not examined the aspect of unjust enrichment. The appeal filed by the Revenue was allowed by the Commissioner (Appeals) and Commissioner (Appeals) held that assessee had not been able to show that they had not passed on the incidence of duty paid by them to the customers and therefore the amount sanctioned as refund has to be credited to the Consumer Welfare Fund. Against this order the assessee is in appeal before me and this appeal is numbered as E/212/2012.
2. In the meanwhile there were also parallel proceedings taken by the Revenue by way of issue of show-cause notice by the original adjudicating authority who had sanctioned the refund to recover the refund already sanctioned under Section 11A of Central Excise Act 1944. This was also adjudicated and the refund sanctioned was demanded and this issue which is a consequence of the earlier proceedings also has been decided against the assessee and therefore the assessee is in appeal and this appeal is numbered as E/26875/2003.
3. The issue involved is whether the appellant has been able to show that there was unjust enrichment or not. After hearing both sides, I find that the Chartered Accountants certificate produced by the appellant did not specifically say that the burden of duty has not been passed on to the customers. The Commissioner (Appeals) has observed that in the case of goods sold for the year 2008-09, in the cost of goods sold the amount of refund claim has also been included and therefore the amount has been included as expenditure. In view of the above, he has taken a view that the appellants have passed on the burden of duty to their customers. Nevertheless in my opinion, the fact remains that this is an observation not based on examination of records of the appellants or the accounts of the appellants. At the same time, the Commissioner (Appeals) also has not gone into this aspect as to whether in the light of the decision of the Honble Supreme Court in the case of UOI Vs Solar Pesticides Pvt. Ltd.[2000 (116) E.L.T.401(SC)] whether it can be said that the duty liability has been passed on to customers or not. This could have been done after examination of production records and the costing records maintained by the assessee based on standard accounting principles. In such a situation, the conclusion reached by the Commissioner without examining the records and in view of the fact that the Chartered Accountant did not specifically certify about the burden having been passed on or not, it is in fairness of things that assessee may be given another opportunity to get their records examined by a Chartered Accountant and get a revised certificate and produce it before the original authority who shall examine the same and consider the refund claim afresh and decide in accordance with law. Since the appeal No. E/26875/2013 is a consequence of the first proceedings, once the matter is remanded in respect of first proceedings, the second appeal becomes infructuous. In the result, both the appeals are set aside and the matter is remanded to the original adjudicating authority for a fresh decision. The appellants are requested to produce the C.As certificate within a period of three months from today so that the matter can be decided expeditiously. It is made clear that if the certificate is not produced by the appellant within three months, the original adjudicating authority shall be free to reject the claim on the ground of unjust enrichment and credit the same to Consumer Welfare Fund.
(Order dictated and pronounced in open court) (B.S.V MURTHY) TECHNICAL MEMBER Pnr...
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