Customs, Excise and Gold Tribunal - Bangalore
Oks Speciality Lubricants India(P) Ltd vs Commission Of Central Excise & Customs ... on 22 May, 2001
ORDER
Shri S.S. Sekhon (Oral)
1. The appellants had filed a refund claim, which was rejected by the Assistant Collector on the following grounds:
"That the assessee had not proved to the contrary that he had not passed on the incidence of duty in the form of Modvat credit to the purchasers as required under Section 12 B of Central Excise and Salt Act, 1944"
2. The Commissioner (Appeals) vide the Order impugned before us came to the following finding:
"The limited question to be decided in this appeal is whether the appellants are entitled to refund of duty paid under protest, keeping in mind two major aspects. The first is whether the incidence of duty was passed on to the buyer and the second, is whether modvat credit was availed by the buyer/customers.....As regards passing on the incidence of duty is concerned, the Assistant Collector has admitted in para 11 of his order in original that "the aspect that duty has not been collected from the customer is accepted". Thus it can be reasonably presumed that the incidence of duty has not been passed on to the customers/buyers of the goods. What remains to be seen is whether modvat credit has been availed by the buyers or not.....None the less, since modvat credit was available to goods of chapter 34, and the appellants have failed to rebut with evidences from their buyer customer regarding availment or otherwise of modvat credit by the ultimate users, they are not entitled to refund of duty paid since this burden is not discharged by the appellant." (Emphasis Suffered)
3. We have heard both sides and considered the matter and find:
(a) When the Commissioner (Appeals) has come to a finding that it was reasonable to presume that incidents of duty has not been passed on to the Customer/buyers, then the refund claim should have been admitted by him.
(b) As regards denial of refund, on the grounds that the buyers would have availed modvat credit, we find that the Section 11-B does not permit such a denial of refund on this ground. Rule-57 E as it then existed, provided for the cases. Where refund of the duty paid by the manufacturer of inputs was allowed. The correct route available to Revenue, was therefore to follow the route prescribed under rule 57-E and not to deny the refund claim on the ground of the MODVAT Credit having been availed, if otherwise refund was eligible under the law. Therefore rejection on the grounds that the buyers would have taken modvat credit and no evidence has been placed by the claimant to prove that modvat credit of the entire amount had not been utilized by the purchasers or the users of the goods under question, is rejection on ground, extraneous to the claim of refund under Section 11-B.
(c) We find that the Orders of the lower authorities are not very clear in as much as in one breath they are going to come to a finding that there is not unjust enrichment applicable in this case and subsequently they are coming to a contrary finding. If the authorities have come to a finding that there is a clause of unjust enrichment applicable to refund under Section 11-B, then the refund should be ordered to be credited to the fund created for this purpose. No such finding appear in the order of the lower authorities. Therefore, the Orders of the lower authorities are set aside and the matter remanded back to be readjudicated and refund ordered as per law.
4. In view of out findings, the appeal is allowed as remand for Denovo Adjudication.
(Pronounced in open court on 22/5/2001)