TMI Blog1995 (11) TMI 113X X X X Extracts X X X X X X X X Extracts X X X X ..... ods for assessing duty under the Heading No. 70.21, which related to 'other articles of glass', in view of Chapter Note 3 of Chapter 17, which states, "for the purposes of this schedule 'glass' is to be taken to extend to fused quarts and fused silica". Item No. 23A(4) of CET states that for other glass and glassware including tableware the duty shall be as prescribed therein. Under Section 3 of the Customs Tariff Act, 1975 (Act No. 51 of 1975 - for short CUSTA'), "any article which is imported into India shall, in addition, be liable to a duty (hereinafter in this section referred to as additional duty) equal to the Excise duty for the time being leviable on a like article if produced or manufactured in India and if such excise duty on a like article is leviable at any percentage of its value, the additional duty to which the imported article shall be so liable shall be calculated at that percentage of the imported article." Hence under CUSTA, the additional duty should be equal to the excise duty on a like article manufactured in India. 4.The company filed claim petitions for refund on the ground that silica crucibles were liable to duty under Heading 69.03 of CUSTA and no ad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8 of 1984 for issue of Mandamus directing (1) the Collector of Customs, Customs House, Madras - 600 001; (2) Union of India through the Secretary, Ministry of Finance, Department of Revenue and Banking, Central Secretariat, North Block, New Delhi; and (3) the Assistant Collector of Customs (Refunds), Customs House, Madras - 600 001 - (appellants in all Writ Appeals - respondents), to refund the sum of Rs. 1,46,918.81, Rs. 31,195.73, Rs. 1,62,281.81, Rs. 26,648.16 and Rs. 76,648.16, being the amount collected as additional duty or countervailing duty under item 23A(4) of CET respectively on bill entries Nos. D.1211, dated 28-4-1982; D.1212, dated 22-3-1980; D.262, dated 5-7-1982; D.1105, dated 19-12-1980 and D.1106 dated 19-12-1980. 10.During the pendency of the above Writ Petitions, the Central Excises and Customs Laws (Amendment) Act, 1991 (Act 40 of 1991 - for short 'Amendment Act'), which was published in the Gazette of India, Extraordinary, Part II Section 1, No. 54, dated 18th September, 1991 came into force. 11.Sub-sections (2) and (3) of the substituted Section 27 and the newly introduce provisions, namely, Sections 28C and 28D of the Act which are relevant for our pres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the goods, prominently indicate in all the documents, relating to assessment, sales invoice and other like documents, the amount of such duty which will form part of the price at which such goods are to be sold. 28D.Presumption that incidence of duty has been passed on to the buyer. - Every person who had paid the duty on any goods under this Act shall, unless the contrary is proved by him be deemed to have passed on the full incidence of such duty to the buyer of such goods." 12.After the amendments came into force, the appellants-respondents filed a counter --- contending that the Writ Petitions were not maintainable, inasmuch as under Section 27(3) of the amended Act, no refund could be made, except as provided for under sub-section (2) of Section 27 and therefore, the company should file an application before the Assistant Collector of Customs, who alone was entitled to scrutinise the application and pass appropriate orders thereon, after considering the following questions, namely, (1) Whether the claims made in these Writ Petitions were or not barred by limitation? (2) Whether the incidence of duties was or not passed on to anyone in the course of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 28C of the Act cannot be made applicable with reference to imports that were made before the introduction of such a provision. It is on the findings, as above, learned single Judge, by order dated 20-3-1992, allowed all the Writ Petitions as prayed for without costs, giving rise to the present appeals, which were taken on file on 13-7-1992. 15.Writ Petition No. 15237 of 1994 came to be filed on 25-8-1994 before a learned single Judge of this Court, who, in turn, ordered notice of motion returnable in three weeks on 30-8-1994. On 20-9-1994, Mr. K. Jayachandran, learned Additional Central Government Standing Counsel, took notice for the respondent and the said Writ Petition was posted, at request, on 26-9-1994, on which date, it stood adjourned initially to 5-10-1994 and to further subsequent dates and ultimately, on 8-11-1994, the said Writ Petition had, however, been admitted and Rule nisi issued calling for records within eight weeks. 16.The jurisdictional or foundational facts leading to the filing of the said Writ Petition arise this way : (a) SRF Limited (petitioner), it is a company incorporated under the Indian Companies Act, 1956, it is said, is a leading manufa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of such duty to the Assistant Collector of Central Excise before the expiry of six months from the relevant date, provided the limitation of six months shall not apply, where any duty has been paid 'under protest'. (g) While the refund application was pending before the respondent, Section 11B of CESA was amended with effect from 20-9-1991, substantially, besides newly introducing Sections 12B and 12C, by the Amendment Act. (i) The amended Section 11B reads as under : "11B. Claim for refund of duty. — (1) Any person claiming refund of any duty of excise may make an application for refund of such duty to the Assistant Collector of Central Excise before the expiry of six months from the relevant date in such form as may be prescribed and the application shall be accompanied by such documentary or other evidence including the documents referred to in Section 12A as the applicant may furnish to establish that the amount of duty of excise in relation to which such refund is claimed was collected from or paid by him and the incidence of such duty had not been passed on by him to any other person : Provided that where an application for refund has been made before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the date of payment of duty. If,(2) on receipt of any such application, the Assistant Collector of Central Excise is satisfied that the whole or any part of the duty of excise paid by the applicant is refundable, he may make an order accordingly and the amount so determined shall be credited to the Fund; Provided that the amount of duty of excise as determined by the Assistant Collector of Central Excise under the foregoing provisions of this sub-section shall, instead of being credited to the Fund, be paid to the applicant, if such amount is relatable to - (a) rebate of duty of excise on excisable goods exported out of India or on excisable materials used in the manufacture of goods which are exported out of India; (b) unspent advance deposits lying in balance in the applicant's account current maintained with the Collector of Central Excise; (c) refund of credit of duty paid on excisable goods used as inputs in accordance with the rules made, or any notification issued, under this Act; (d) the duty of excise paid by the manufacturer, if he had not passed on the incidence of such duty to any other person; (e) the duty of excise bo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Fund. There(2) shall be credited to the Fund, in such manner as may be prescribed, - (a) the amount of duty of excise referred to in sub-section (2) of Section 11B or sub-section (2) of Section 11C or sub-section (2) of Section 11D; (b) the amount of duty of customs referred to in sub-section (2) of Section 27 or sub-section (2) of Section 28A, or sub-section (2) of Section 28B of the Customs Act, 1962 (52 of 1962); (c) any income from investment of the amount credited to the Fund and any other monies received by the Central Government for the purpose of this Fund." (h) Subsequent to the Amendment of Section 11B and the introduction of new Sections 12B and 12C by the Amendment Act, the respondent issued a notice dated 6-1-1992 calling upon the petitioner to show cause why the amount of refund claimed by the petitioner should not be credited to the Consumer Welfare Fund in terms of sub-section (2) of Section 11B read with Section 12C of CESA. (i) There was no dispute regarding the claim for refund and the sum claimed by the petitioner as refundable. The only issue that was raised by the respondent was that the amount claimed as ref ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... zed of by a Division Bench of this Court in the Writ Appeals as above, there is no efficacious alternative remedy, except to resort to the jurisdiction of this Court under Article 226 of the Constitution of India to quash the impugned order and ultimately prays for a direction to refund the sum in question, instead of crediting it to the Consumer Welfare Fund. In these circumstances, the doors of this Court under writ jurisdiction had, therefore, been, it is said, knocked at. 17.The pith and substance of the counter filed by the respondent is reflected as below : (a) RF solution, which has no shelf-life, was however, originally construed to be 'goods' and consequently, duty had been levied and collected from the petitioner, of course, 'under protest' from 17-10-1983. The petitioner agitated the matter by way of appeal to the Collector (Appeals) and further appeal to CEGAT, which remanded the case to review afresh in the light of the various points raised by the petitioner to the original authority, that is to say, the respondent - Assistant Collector of Customs, who, in turn, after giving a personal hearing, passed an order No.64/90 dated 29-9-1990 holding that RF soluti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... production of the articles manufactured by the appellant*. The appellant* has no objection for permitting the Department to inspect its factory for the said purpose. However, it is submitted that such inspection should not be done without notice to the appellant* and in their absence. Learned Counsel for the Department submits that such inspection would be done after notice to the appellant* and in the presence of the appellant* or its authorised representative. In the light of these submissions the inspection as prayed for is allowed in the aforesaid terms. It is also further ordered that after the inspection, an affidavit along with the report of the inspecting officer should be filed and a copy of such affidavit and the report shall also be furnished to the appellant* before it is filed into the Court. Parties pray for two weeks time to complete the inspection and to file the report. Therefore, we direct these appeals be called on 8-9-1995 for filing the report." (*"Appellant" herein means 'Company' - as earlier indicated) 20.One Vivek C. Khole, Appraiser, Office of the Commissioner of Customs, Customs House, Madras-600 001, accordingly inspected the factory premises of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ogen and Oxygen gases are produced by electrolysis of water. 4.FUSION : With the help of Hydrogen and Oxygen gases and Aluminium Powder obtained during calcination Single Crystals of Alumina are developed . During this process flow of Alumina powder as well as Oxygen and Hydrogen gases are controlled in order to achieve best results. These single crystals are called a Rough Synthetic Gem Stones." 21.In pith and substance, from the submissions of Mr. C.A. Sundaram, learned Additional Central Government Standing Counsel appearing for the appellants; Mr. Habibullah Badsha, learned Senior Counsel representing M/s. B. Sashidharan D. Mythili, learned Counsel appearing for the respondent (in Writ Appeals) as well as petitioner (in Writ Petition) and Mr. K. Jayachandran, learned Additional Central Government Standing Counsel appearing for the respondent (in the Writ Petition), the points, as below, arise for consideration : (1) Whether the Scheme of the Amendment Act envisages a direct transfer of the burden of duty of customs or excise, along with the sale of the same goods to the buyer? (2) Whether the doctrine of unjust enrichment is applicable to cases, where ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . (a) Under the Customs Notification No. 122 of 1978, dated 21-6-1978 a concessional rate of duty was levied on the import of copper scrap, which was used for the manufacture of chemicals. While availing of this concessional Customs duty, the petitioners furnished an end-use bond in favour of the Customs Department, duly guaranteed by the petitioners' Bankers. This bond is for the purpose of ensuring that the copper scrap imported by the petitioners is used for the manufacture of Copper Oxychloride. Once the copper scrap is so consumed, a Chartered Accountant's certificate regarding such consumption along with an affidavit is furnished before the Customs Department. The Customs Department, after varification, cancels the bond. (b) Under Notification No. 35/81-CE, dated 1-3-1981, an exemption is granted to waste or scrap of copper, zinc, aluminium and lead, if used in the manufacture of chemicals. Exemption is granted from the whole of the duty of excise leviable inter alia on copper scrap provided that : (i) it is proved to the satisfaction of an officer not below the rank of Assistant Collector of Central Excise that the said waste or scrap is intended ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aimed by them, their claims ought to be considered in the light of the Amendment Act (Central Act 40 of 1991). (h) It was in those circumstances, the Bombay High Court had the occasion to consider the provisions of Section 27 of the Act, and had observed in paragraphs 18 to 26 (at pages 205-206) thus : Hence the entire scheme is designed for a situation where (1) the importer of goods after clearing the goods on payment of duty, sells these goods to others. In the process either he directly passes on the incidence of duty to his buyer or does not. Only in the latter case will the importer get the refund. Otherwise, the refund will go to the buyer or to the Consumer Welfare Fund as per the sections. (2) If the duty is passed on to the buyer, the right to recover the duty is also passed on to the buyer of the imported goods. Provided that the buyer has not in turn sold these goods and passed on the duty to the next buyer. (3) The converse situation contemplated is where the importer uses the goods himself. Here there is no question of passing on the incidence of duty to anyone-else since the goods imported are not sold to anyone-else. Hence he can get the refund. Therefo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Objects and Reasons. "The question of 'unjust enrichment' in cases of goods subject to duty of excise of customs has been the subject matter of discussion for quite sometime now. The concept of 'unjust enrichment', in so far as it relates to the said duties, is that any refund of these duties made to any manufacturer or importer, who may have initially paid these duties but had passed on the same to the buyers, would be in the nature of a windfall given to such manufacturer or importer. xxxxxx xxxxxx The Bill aims at giving effect3. to the aforesaid recomendation of the Committee and proposes the following main amendments in the said Acts, namely :- (a) the manufacturer or importer of goods shall not be entitled to refund of the duty of excise or, as the case may be, the duty of customs if he has already passed on the incidence of such duty to the buyer; (b) the burden of proof that the incidence of the duty has not been passed on to the buyer shall be on the person claiming the refund; (c) every person, who is liable to pay duty of excise or, as the case may be, the duty of customs on any goods, shall be under an obligation to prominently indic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unjust enrichment of the claimants. Negativing this contention, the Supreme Court observed that the octroi in the case before it was a duty on the entry of the raw materials, for coming in. "It is the duty on the coming in of the raw materials which is payable by the producer or the manufacturer. It is not the duty on going out of the finished products in respect of which the duty might have been charged or added to the costs passed on to the consumers. In such a situation, no question of 'undue enrichment' can possibly arise in this case." In the present case the25. additional duty of customs is levied on raw material which is being imported. It is not an additional duty on any finished product which is going to be sold to the consumer and to whom the incidence of the additional duty of customs can be passed on directly. Since the additional duty of customs has not been directly passed on by the petitioners to any third party by selling the imported goods, they are entitled to claim refund of this amount under proviso (a) to Section 27(2) of the amended Section 27. It was also submitted before us26. that in any case since this is a claim for recovery of monies paid under a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pondent preferred appeals before the Collector of Central Excise (Appeals). The Appellate Collector by an order dated 30-12-1975, allowed the appeals arising out of the three refund applications relating to the period 20-2-1972 to 28-2-1973, and set aside the orders passed by the Assistant Collector and ordered consequential relief in favour of the respondent by directing the refund of the excess excise duty paid. The appeals pertaining to the refund applications for Rs. 23,68,686.85 and Rs. 26,21,356.16 for the period 1-9-1970 to 28-5-1971 and 1-6-1971 to 19-2-1972 respectively were, however, rejected by the Collector (Appeals) on the ground that the same were barred by time. (c) The respondents did not take the matter further under the statute but instead filed W.P. No. 971 of 1976 seeking quashing of the order of the Collector of Central Excise (Appeals) dated 30-12-1975 and also sought a direction by way of Mandamus for refund of the sum of Rs. 49,90,043.01 with interest at 12 per cent per annum thereon. (d) The Division Bench of the Delhi High Court came to the conclusion that on account of a mistake of law, excess excise duty had been paid by the respondent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cent per annum to the appellants. (f) On 15-4-1993, when the case came up for hearing before the apex Court, learned Counsel for the appellants, it seems, raised the plea based on Section 11B, as amended by the Amendment Act 40 of 1991, to deny refund to the respondent. After hearing learned Counsel for the parties, the apex Court directed the respondent "to furnish documentary or other evidence as the respondent may deem appropriate to establish that the amount of duty of excise in relation to which the refund is claimed was collected from or paid by him and the incidence of such duty had not been passed on by him to any other person." The appeal was directed to be posted for hearing on 10-5-1993. (g) The respondents did not file any documentary or other evidence nor even an affidavit stating that the incidence of duty of excise in relation to which the refund was being claimed had not been passed on to any other person. The arguments were heard finally on 14-5-1993 and the judgment was reserved, though liberty was granted to learned counsel for the parties to file written submissions, if any, in support of their arguments. The respondent filed written submiss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -1982 was a conditional one and subject to the respondent (i) furnishing bank guarantee to the Collector of Central Excise, Meerut for the amount in question; and (ii) that in case the respondent fails in this appeal, it shall be liable to pay interest at 12 per cent per annum while refunding the amount to the appellant. Thus, the amount in question was directed to be paid to the respondent by this Court only as an interim arrangement, during the pendency of the appeal and could not be construed to be an order of 'execution' of the order and directions of the High Court. The conditional order made on 8-10-1982 did not finally conclude the "refund claim" of the respondent and cannot take the case of the appellant out of the purview of Section 11B(3) of the Act read with the first proviso to Section 11B(1), as amended. The argument on behalf of the respondent to the contrary is not only spacious but also fallacious. In this connection, it would also be advantageous to note a judgment of a three Judge Bench of this Court in Union of India Others v. Jain Spinners Limited and Anr. [1992 (61) E.L.T. 321 (S.C.) = 1992 (4) SCC 389], as the law on the question of retrospectivity of Sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... refund. The Union of India sought two months time to consider the claim for refund in accordance with the amended provisions of Section 11B. The application was rejected by the High Court in view of the order dated 19-9-1991, which had been passed prior to the coming into force of the Amendment Act with effect from 20-9-1991. In November, 1991, the assessee filed a contempt petition alleging failure on the part of the officers of the Union of India to comply with the High Court's order granting refund to the assessee. When the petition came up for hearing on 18-3-1992, the counsel for the respondent submitted that the question regarding the applicability of the amended provisions was under consideration of the Government and be sought time. On 13-4-1992, the Assistant Collector passed an exhaustive order holding that since the assessee had passed on the incidence of duty to others, it was not entitled to receive the refund. The High Court at the time of hearing of the contempt petition on 20-4-1992 was apprised of the order of the Assistant Collector; but it held that the decision of the Assistant Collector was not a decision of the Government and directed the Union of India to de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duty to others. It would create two official classes of assessees, viz., those who have paid the duty to the authorities and those who have obtained orders from the Courts for depositing the duties in courts. The former will, and the latter will not, be governed by the amended provisions of the Act. This would result in a discriminatory and invidious situation. The view canvassed by the learned counsel will also open a new door for unjust enrichment by enabling the assessees to bypass the statutory provisions which have been specifically enacted to prevent the malpractice." The16. judgment in Jain Spinner's case (supra), therefore, answers fully the submissions raised on behalf of the respondents and we reject the plea raised on behalf of the respondent that the prohibition contained in Section 11B(3) of the Act would not apply to the facts and circumstances of the present case more so because the judgment and order, of the High Court directing refund was pending final adjudication by this Court when the amended provision of Section 11B(3) of the Act came into force with effect from 20-9-1991. That apart, the argument on behalf of the respondent that in the present case 'refund ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o 8 (at pages 8-9), which read as under : The appellants do not dispute that for the purpose of determining assessable value, it is the price at which the manufacturers sell the products to the wholesale dealers and not the price at which the wholesale dealer make further sale to the secondary wholesalers which is to be taken into account. The High Court found on the basis of the material on the record, that the appellants had received from the respondent the duty of excise in excess of what was admissible in law, because of a wrong interpretation placed by the respondent on the provisions of Section 4 of the Act. The respondent realised the mistake after this Court in Voltas case (supra) laid down the correct basis for assessment in such cases. It has been settled by this Court that where excess duty was not payable by the party under the provisions of a statute but had in fact been paid under a mistake of law, the party has a right to recover it and there is a corresponding legal obligation on the part of the Government to refund the excess duty so collected because the collection in such cases would be without the Authority of Law. The payment and recovery of excess excise dut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sideration the date when the mistake came to be known to the party concerned. Just as an assessee cannot be permitted to evade payment of rightful tax, the authority which recovers tax without any authority of law cannot be permitted to retain the amount, namely because the tax payer was not aware at that time that the recovery being made was without any authority of law. In such cases, there is an obligation on the part of the authority to refund the excess tax recovered to the party, subject of course to the statutory provisions dealing with the refund. We8. are, therefore, of the opinion that the High Court, while disposing of the writ petition under Article 226 of the Constitution of India, was perfectly justified in holding that the bar of limitation which had been put against the respondent by the Collector, Central Excise (Appeals) to deny them the refund for the period 1-9-1970 to 28-5-1971 and 1-6-1971 to 19-2-1972 was not proper as admittedly the respondent had approached the Assistant Collector Excise soon after coming to know of the judgment in Voltas case (supra) and the assessee was not guilty of any laches to claim refund." 27.The Supreme Court further considered ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... This averment is not at all satisfactory. It does not go to show that the respondent did not pass on the burden of the excess excise duty to any other person. The expression "was not passed on to the customer, as explained in the illustration" is vague and non-specific. It is not stated as to at what rate the duty was collected by the respondent in the present case. The 'illustrations' given in the affidavit cannot carry the matter any further; nor can the same be any substitute for a clear and categoric statement of fact that the excess duty was paid by the assessee or collected from it and that its incidence was not passed on by the assessee to any other person. There is no averment, much less a clear and specific one, even to show that the respondent did not collect excise duty at the higher rate (even according to the illustrations) when they sold the goods, since the price was an integrated or cum duty price. The respondent has not filed any evidence or material whatsoever to show that the burden of excess excise duty has been borne by them and not passed on to any other person in spite of ample opportunity given by this Court. Section19. 12B of the Act which was also intro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ods and therefore they are in any case not entitled to get a refund. The argument was that if refund is ordered it would amount to allowing the appellants to unjustly enrich themselves at the cost of the public to whom the burden had already been passed. This argument is based on the ground that in the selling price the Company had merged the octroi duty originally paid as deposit and if a refund is made the company would be getting an additional amount over and above normal price which they would have charged but for the fact that they were initially asked to deposit octroi. There is no evidence that any of the articles sold by the Company is subject to any price control by the government or that the Company had charged any person octroi separately in the bills. Invoices, and the other documents of sale to the outside purchasers produced before us do not also show that any octroi was separately charged and collected by the Company. It may be mentioned that in the rejoinder filed by the appellant in the writ petition they have specifically denied that they "have recovered the amount paid by them by way of octroi duty from the dealers to whom they had sold the goods or that the deal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ort, penned above on verbatim, throw flood of light as to the user of silica crucibles for the manufacture of synthetic gems. In fact, silica crucibles are not consumed in the manufacture of synthetic gems. To put it otherwise, the duty of customs paid on such imported crucibles does not become a part of the manufacture of the new item, viz., synthetic gem, in which the imported item, that is to say, silica crucibles, is an ingredient. What is further getting revealed is that in the process of manufacture of synthetic gem, the dried double sulphate is taken in quartz cups or silica crucibles, which are kept in muffle furnace at around 1200ºC, since such crucibles have the ability to withstand high temperature and high resistance to thermal shock. In that process, nine cups are used for one batch - three cups in each row for three rows. When calcination is taking place, moisture, ammonia gas, sulphur dioxide gas are escaping. After calcination for an hour, the crucibles are allowed to cool for approximately an hour. After removal of aluminia powder from those crucibles, they are again filled with double sulphate, which is subjected to calcination. Thus, a crucible is subjected to 5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s indirectly passed on to the customer or buyer, inasmuch as the customs duty paid on the raw material or imported goods is included in the price of the finished product. No manufacturer will be charitable enough to exclude customs duty paid on the raw material, in the price of the finished product. Further, the Bombay High Court is of the view that the importer or the person, who paid the duty of customs or excise is entitled to refund of the duty so paid, if he had not directly passed on the incidence of such duty to any other person. We are, however, not persuaded to share such an opinion. The reason is rather obvious. What is contemplated in Section 27(2)(a) of the Act is relatable to passing on the incidence of duty to any other person for the determination of the question of refund claims. 34.Worthy it is to reproduce at this juncture, the said provision in verbatim, so as to understand in a better fashion, the Legislative intent expressed therein. It reads as : "the duty and interest, if any, paid on such duty paid by importer, if he had not passed on the incidence of such duty and interest, if any, paid on such duty to any other person" (emphasis is ours) The provis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of refund of customs duty paid on silica crucibles captively used for the manufacture of synthetic gems in the case of the company (Indo-Swiss Synthetic Gem Manufacturing Company Limited). We have, however, held that the company is entitled to the refund of claim, not on the rationale of Solar Pesticides Pvt. Ltd. (supra), but on a different footing that silica crucibles were captively used for the manufacture of the synthetic gems as refractory goods and consequently, the question of passing on the incidence of customs duty paid did not at all arise for consideration. Whereas in the case of RF solution as the same was consumed in the manufacture of dipped solution, which in turn was used in the manufacture of dipped fabrics, we are of the view that the duty of Central Excise paid during the relevant period by the petitioner was passed on indirectly to the customers or buyers of finished product-dipped fabrics. The petitioner - SRF Limited did not, however, place or produce any tangible material to point out that as matter of fact, it did not at all pass on the incidence of excise duty paid on RF solution to the customers or buyers, during the relevant period by including th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of about fifteen months from the date of clearance of the goods, as evidenced by the bills of entries filed, about which, we have referred to earlier. 40.In such circumstances, we are not persuaded to hold that there was any laches on the part of the company in knocking at the doors of the writ jurisdiction of this Court under Article 226 of the Constitution of India, when especially, the duty of customs was not payable by the Company under the provisions of the Act, but had, in fact, been paid under a mistake of law and the company has a right to recover it and there is a corresponding obligation on the part of the Department to refund the excess duty so collected, because the collection in such cases is without the authority of law. 41.The further question, in such a situtation, that arises for consideration is as to whether the bar of limitation, as had been provided under Section 27 of the Act, is applicable, in preventing the company from seeking redress under Article 226 of the Constitution of India. There is no difficulty at all for us to answer such a question in favour of the company, on the face of the law laid down by the Apex Court in the case of ITC Limited (supra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nding, it follows - as night follows day - that the company is entitled to the refund of the customs duty paid, during the period in question, as referred to earlier. 43.The last, but not the least, question requiring anxious consideration is relatable to non-exhaustion of the alternative remedy, before ever the doors of this Court are knocked at in its writ jurisdiction and the consequences to flow therefrom. This sort of a question took a different hue and colour in the case of the Company. The Department did not at all in fact raise such a question directly by stating that the non-availing of the alternative remedy would result in non-suiting the Company. But, what is contended is that unless there is adjudication, as contemplated under Section 27 of the Act, no relief can be granted by way of refund. Such a bone of contention appears, on the face of it, to be tenable. But the utter untenability, taking shelter thereunder, would get exposed, if a deeper scrutiny is made of the relevant statutory provisions, in the light of the fact-situation. 44.To recapitulate, the Company had been importing silica crucibles from 1976 onwards and had been paying duty, as demanded by the De ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndent, holding that RF solution is not 'goods' and consequently, no duty is leviable on the same. It is not as if the petitioner paid the duty of excise for the relevant period without any protest and the plain fact is that the duty had been paid 'under protest' and such being the case, the bogey of the statutory period of limitation of six months for making an application claiming refund of duty of excise paid under mistake of law cannot at all be put against the petitioner, by the Assistant Collector of Excise for refusing the claim of refund, if an application is made therefor. Of course true it is, such a fact that the petitioner did not perform. But the sorbid fact is that the petitioner, without availing of such alternative remedy, chose to straight away knock at the doors of this Court in its writ jurisdiction, of course, without placing any tangible materials to vouchsafe such a claim, in order to rebut the presumption created under Section 12B of CESA. 47.Further, it is to be pointed out here that the adjudication of the refund claim involves consideration and appreciation of evidence or disputed facts relatable to passing on or otherwise of the incidence of duty of exci ..... X X X X Extracts X X X X X X X X Extracts X X X X
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