Custom, Excise & Service Tax Tribunal
M/S Jbf Industries Ltd vs Commissioner Of Central Excise & on 30 July, 2015
CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL West Zonal Bench, Ahmedabad Appeal No. : E/1491/2008 (Arising out of Order-In-Appeal No. KRS/261/VAPI/2008 Dated 12.09.2008 Passed by Commissioners Central Excise, Customs and Service Tax-VAPI) M/s Jbf Industries Ltd. : Appellant (s) VERSUS Commissioner of Central Excise & Service Tax-Vapi : Respondent (s)
Represented by :
For Appellant (s) : Shri. Willingdon Christian, Advocate For Respondent (s): Shri. L. Patra, Authorised Representative For approval and signature :
Mr. H.K. Thakur, Honble Member (Technical) 1 Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No 2 Whether it should be released under Rule 27 of CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? No 3 Whether their Lordships wish to see the fair copy of the Order? Seen 4 Whether Order is to be circulated to the Departmental authorities? Yes CORAM :
Mr. H.K. Thakur, Honble Member (Technical) Date of Hearing / Decision : 30.07.2015 ORDER No. A/11158/2015 Dated 30.07.2015 Per : Mr. H.K. Thakur;
This appeal has been filed by the appellant against OIA No. KRS/261/VAPI/2008 dated 12.09.2008 passed by Commissioner (Appeals), Vapi, under which OIO No. 16/AC/REFUND/SLV IV/08 dated 31.01.2008, passed by the adjudicating authority, was upheld. Adjudicating authority under OIO dated 31.01.2008 rejected a refund claim of Rs. 10,91,510/- filed by the appellant on the grounds that unjust enrichment is involved and that buyers of goods must have taken full credit on the duty originally paid by the appellant.
2. Shri. Willingdon Christian (Advocate) appearing on behalf of the appellant argued that certain discounts given by the appellant, like performance based discounts, are not known at the time of the clearance of goods. That in subsequent sales the credit notes are given as adjustments in future bills. It was his case that in effect the duty with respect to performance based discounts, is never paid by the traders/buyers. He relied upon the following cases in support of his argument that the unjust enrichment is not applicable in the present proceedings:-
(i) CCE Vs. Bharat Explosives Ltd. - [2008 (231) ELT 687 (T)].
(ii) CCE Vs. Vardhman Industries Ltd. [2008 (88) RLT 392 (CESTAT)].
(iii) CCE Vs. Mahavir Spinning Mills Ltd. [2007 (212) ELT A152 (SC), 2007 (207) ELT 94 (T)].
(iv) CCE Vs. IBP Ltd. [2013 (288) ELT 385 (T)].
(v) Sudhir Papers Ltd. Vs. CCE [2012 (276) ELT 304 (Kar.)].
(vi) CCE Vs. Solaris Chemtech Ltd. [2011 (273) ELT 191 (Kar.)].
(vii) CCE Vs. Mysore Electrical Industries Ltd. [2011 (267) ELT 607 (Kar.)].
(viii) UOI Vs. A.K. Spintex Ltd. [2009 (234) ELT 41 (Raj.)].
(ix) Jetex Caburettors Pvt. Ltd. Vs. CCE [2007 (210) ELT 73 (T)].
(x) Jolley Electronics Industries Vs. CCE [2009 (233) ELT 362 (T)].
(xi) Colourtex Vs. UOI [2010 (257) ELT 14 (Guj.)].
3. Shri. L. Patra (AR) appearing on behalf of the Revenue argued that Commissioner (Appeals), has also rejected the refund claim of the appellant on the grounds that buyers of goods being manufactures and must have taken Cenvat Credit of the entire duty paid by the appellant. He made the bench go through Para 5 of OIA dated 12.09.2008 to argue that double benefit of credit taken by the buyers and also asking for refund can not be admissible.
4. Heard both sides and perused the case records. On the ground of unjust enrichment it was argued by the Appellant that in case of credit notes unjust enrichment is not applicable, as per the relied upon case laws. It is observed from Para 9 of the order passed by CESTAT Delhi in the case of Mahavir Spinning Mills Ltd. vs. CCE Jalandhar (Supra) that where discounts are given by credit notes over a period of time then doctrine of unjust enrichment is not applicable Para 9 of this order is relevant and is reproduced below:-
9. Commissioner (Appeals)s order also raised the issue whether the refund arising from the finding of provisional assessment would be hit by unjust enrichment. As already noted, a part of the discount is passed through credit notes and is adjusted in the outstanding bills of the wholesale dealers. Therefore, discount and tax applicable on it does get adjusted on monthly basis. Therefore, this is not a case where tax-has been passed on to the buyers. Therefore, the question of unjust enrichment cannot arise in the present case. Accordingly, the finding on this score is also set aside. 4.1 In view of the above settled proposition of law refund claim filed by the appellant can not be rejected on the doctrine of unjust enrichment. However, appellant could not produce any documentary evidence/certificate of a Chartered Accountant to the effect that buyers of the appellant have not taken Cenvat Credit of the duty paid by the appellant. Order passed by the first appellate authority regarding likely double benefit so accrued to the appellant and the buyer is, therefore, correct and such double benefit can not be allowed. Appeal filed by the appellant is thus rejected on that count.
(Operative part of the order pronounced in the Court) (H.K. Thakur) Member (Technical) VM 1