Customs, Excise and Gold Tribunal - Tamil Nadu
Srf Ltd., Chemplast Sanmar Ltd. And ... vs Cce on 28 May, 2003
Equivalent citations: 2003(88)ECC559
JUDGMENT Jeet Ram Kait, Member (T)
1. The appeal filed by M/s SRF Limited is against Order-in-Appeal No. 134/97 (T) dated 9.10.97 and the appeals filed by M/s. Chemplast Sanmar Ltd. are directed against Order-in-Appeal No. 137 & 138/95 (CBE) dtd. 16.8.95 and the appeals filed by M/s. Chemicals and Plastics India Ltd., are against Order-in-Appeal Nos. 18 & 19/95 (CBE) dated 28.2.95 by which the learned Commissioner (Appeals), Trichy has disallowed the refund claim on merit by upholding the orders of the Asst. Commissioner and by rejecting the appeals filed by the aforesaid appellants.
2. Ld. Advocate Smt. L. Mythili appeared on behalf of all the appellants and submits that the Hon'ble High Court of Judicature at Madras in the case of Addison & Co. v. CCE, Madras, 2001 (129) ELT 44 (Mad.) has held that there can be no passing on of the incidence of the duty if the manufacturer merely reduces his burden by receiving the refund. She, further, submitted that the Hon'ble High Court had framed the issue whether when the burden of duty was passed on by the manufacture to its various dealers by issue of credit notes. The tribunal was right in concluding that the ingredients of Section 11AB was not satisfied. This issue was answered by the Hon'ble High Court in favour of the assessee. She also invited our attention to the judgment rendered by this Bench in the case of Chemplast Sanmar Ltd. v. CCE, Coimbatore, 2002 (84) ECC 728 (T) : vide Firal Order No. 1174/2002 dt. 21/10/2002. The reference application before the High Court was decided in favour of the assessee by setting aside the order of the Tribunal and answered the reference in favour of the assessee. She also invited our attention to the CEGAT's decision rendered in the case of Satpal, Amritsar v. CC & CCE, Chandigarh, 1987 (27) ELT 107 (T) in which it has been held that the appellate Tribunal has to keep in view the decision of the High Court within whose' jurisdiction the original proceedings are arising, particularly, if reference was made to that High court. She, therefore, submitted that since reference was made to the High Court of Judicature at Madras in the case of Addison & Co. v. CCE, Madras (supra) and the decision is in favour of the assessee, such decisions are binding on the Tribunal as they are under the Superintendance and control of the Hon'ble High Court of Judicature at Madras. She also invited our attention to the judgment rendered by the Tribunal in the case of Lamps, Caps and filament Ltd. v CC, Bombay, 1987 (27) ELT 93 (T) in which also it has been held that the Tribunal is bound by the judgment of the High Court within whose jurisdiction they are functioning. She, therefore, submitted that in view of the decision of the Hon'ble High Court in the case of Addison & Co. v. CCE, Madras, they are entitled for the refund. She, therefore, submitted that the orders of the learned Commissioner may be set aside and refund allowed to them.
3. Ld. SDR Smt. R. Bhagya Devi and learned JDR Shri A. Jayachandran submit that the provisions of unjust enrichment are attracted even where the collected amount of Excise duty has been paid back to the buyers subsequently as has been held in the case of S. Kumar's Ltd. v. CCE, Indore, 2003 (85) ECC 642 (LB) : 2003 (53) RLT 399 (CEGAT-LB). In the above cited case, the Larger Bench held that the view taken in Thermon Heat Tracers Ltd., 2001 (45) RLT 85 (CEGAT) ; 2001 (132) ELT 455, is not good law and the ratio in the decision of Sangam Processors (Bhilwara) Ltd. v. CCE, Jaipur, 1994 (71) ELT 989 (T) which had been affirmed by the Apex Court has to be followed. She, further, submitted that in the case of Sangam Processors (Bhilwara) Ltd. (supra), the credit note in respect of duty incidence issued by the assessee to customers even before issue of Notification under Section 11C the refund claim was found to be not admissible. She, further, invited our attention to another judgment of Larger Bench in the case of Mira Silk Mills v. CCE, Mumbai, 2003 (56) RLT 152 (CEGAT-LB) wherein the Larger Bench has held that in the normal circumstances if there is conflict between law laid down by a High Court and the ratio of the decision of the Tribunal, whether it is a Larger Bench or not, the High Court decision will prevail over the Tribunal decision. But in the present case, since the Tribunal's decision in the case of Sangam Processors (Bhilwara) Ltd. (supra) is based on the ratio of the Supreme Court decision then it will prevail over in view of the provisions of Article 141 of the Constitution. She, therefore, submitted that in view of the fact that the issue is decided by the Hon'ble Apex Court, the judgment of Apex Court will prevail over the judgment rendered by the High Court. In view of above facts and circumstances and the law laid down by the Supreme Court she submits that all the appeals are required to be rejected.
4. In counter, the learned Advocate submits that the judgment rendered by the Tribunal in the case of Sangam Processors (Bhilwara) Ltd. (supra) was on a different context of a notification issued under Section 11C and is not applicable to the facts of the case and is clearly distinguishable, whereas the judgment of the Hon'ble High Court of Judicature at Madras is directly on the issue and squarely covers their case. She, therefore, submitted that the appeal filed by them may be allowed by setting aside the impugned orders.
5. We have gone through case records and considered the rival submissions made by both the parties and find that the issue is covered by the judgment rendered by S. Kumar's Ltd. v. CCE, Indore, 2003 (85) ECC 642 (LB) : 2003 (55) RLT 399 (CEGAT-LB) which has held that the provisions of unjust enrichment are attracted even where the collected amount of excise duty has been paid back to the buyer subsequently. In para-9 of the judgment, the Larger Bench has held that the ratio of the decision in the case of Sangam Processors Ltd. v. CCE, 1994 (71) ELT 989 (T) which had been affirmed by the Hon'ble Apex Court has to be followed and they are not entitled for the refund claim as it is proved that the incidence of duty has been passed on to the customers at the time of clearance of goods. Similarly, the Larger Bench in the case of Mira Silk Mills v. CCE, Mumbai, 2003 (56) RLT 152 (CEGAT-LB) has also held that it is only in normal circumstances if there is conflict between law laid down by a High Court and the ratio of the decision of the Tribunal, whether it is a Larger Bench or not, the High Court decision will prevail over the Tribunal decision. It also held that if the Tribunal decision is based on the ratio of the Supreme Court decision, then it is really a conflict between a decision of the Apex Court and that of the High Court and naturally the decision of the Apex court will prevail in view of the provisions of Article 141 of the Constitution.
6. As regards the plea of learned Advocate that the judgment rendered in the case of Sangam Processors (Bhilwara) Ltd. (supra) was in the context of a notification under Section 11C, we are not in a position to persuade our selves inasmuch as in that case also the credit notes were issued though before issue of the Notification under Section 11C. In view of the facts and circumstances, by following the judgment rendered by the larger bench rendered in the case of S. Kumar's Ltd. v. CCE, Indore (supra) which is in conformity with the judgment rendered by the Tribunal in the case of Sangam Processors (Bhilwara) Ltd (supra) which was affirmed by the Apex Court, we are bound to follow the Larger Bench judgment which is based on the Supreme Court judgment in view of provisions of Article 141 of the Constitution.
7. Since we are rejecting the appeals on merits, the issue of time bar taken in some of the appeals is not discussed by us as the issue is already covered by the Larger Bench based on a decision confirmed by Supreme Court. In view of the facts and circumstances, we reject all the appeals. Ordered accordingly.