Customs, Excise and Gold Tribunal - Delhi
Sti Sanoh India Ltd. vs Commissioner Of Central Excise on 24 November, 2000
Equivalent citations: 2001(127)ELT572(TRI-DEL)
ORDER K.K. Bhatia, Member (T)
1. The facts in brief in this case are that the appellants manufacture Copper Brazed Steel Tubes both ends of which are filled with duty paid rubber seals. The appellants took Modvat credit on these rubber plugs. The Asstt. Commissioner, Ujjain disallowed the credit on these plugs by three different orders all dated 23-8-1989. The appellants filed an appeal against these orders before the Commissioner (Appeals). They also reversed the Modvat credit of duty availed on these plugs and wrote a letter to the Asstt. Commissioner of Central Excise, Ujjain stating that this amount was debited under protest and that they were approaching Collector (Appeals), New Delhi against the above orders. The appellants finally succeeded when the CEGAT vide its Final Order No. A/670-671/95-NRB, dated 16-8-1995 1996 (81) E.L.T. 346 (Tribunal) held that the Modvat credit was admissible to them on rubber plugs. Consequently, appellant filed a refund claim for Rs. 4,66,065.49 on 24-1-1996 with the Asstt. Commissioner of Central Excise, Ujjain Division. This claim has been rejected by the Asstt. Commissioner vide his Order-in-Original dated 15-4-1996 as time barred and on the ground of unjust enrichment. These findings are upheld by the Commissioner (Appeals), Bhopal vide his order dated 8-12-1999. Hence, the present appeal.
2. I have heard Shri Devender Sharma, Consultant for the appellants and Shri M.D. Singh, SDR for the Respondents. The refund amount relates to the period from 15-11-1989 to 12-6-1995. The claim in respect of this was filed on 24-1-1996 - beyond a period of six months. Therefore, the original authority has rejected it as time barred. He does not accept that the payment was made under protest during this period, as he has observed that the protest letters were delivered to the proper Officer after payment of duty, whereas in terms of Rule 233B, the duty can be said to have been paid under protest only from the date on which the letter of protest was delivered to the proper Officer before the payment of duty. It is observed that since in this case, the protest had been lodged with the proper Officer after the date of payment of duty, therefore, the duty paid by them cannot be treated to have been paid under protest. I have examined these findings. One need not dwell on this point for long, since, it is not in dispute that the refund claim in this case is preferred as a result of the Tribunal Final Order in favour of the appellants. The Hon'ble Supreme Court in Mafatlal Industries Ltd. v. Union of India -1997 (89) E.L.T. 247 (S.C.) have observed that where a person proposes to contest his liability by way of appeal/revision in the High Court, he would naturally pay the duty whenever he does, under protest. It is difficult to imagine that a manufacturer would pay the duty without protest even when he contests the levy of duty, its rate, classification or any other aspect.
Since in the present case, the appellant agitated the main issue of the admissibility of Modvat credit on the duty paid on rubber plugs at different levels of appeal which finally settled in their favour by the aforesaid order of the Tribunal, the payment made by them during the pendency of such proceedings shall be deemed to be made under protest. The same view is held in the Tribunal decision in General Engineering Works v. CCE, Jaipur - 1999 (111) E.L.T. 86 (T). Consequently, the order for rejecting the refund claim as time barred by the lower authorities is not valid and the same is accordingly liable to be set aside. As regards the application of the doctrine of unjust enrichment to this claim, it is observed that the Central Excise Authorities raised objection on the appellant's taking the Modvat credit for the duty paid on a certain input. The appellants paid back the amount of Modvat credit taken on such input and agitated the matter further in which they finally succeeded. Therefore, the refund of such amount does not relate to the duty paid on the goods cleared by them, but it is in respect of the credit of duty admissible on the inputs. The doctrine of unjust enrichment on these facts therefore, would not be applicable to the impugned claim. It is therefore held that the refund claim is admissible to the appellants and the appeal is accordingly allowed.