TMI Blog2006 (8) TMI 420X X X X Extracts X X X X X X X X Extracts X X X X ..... lt with them in his arguments. 3. Appeal No. E/5176/04 has been filed by the appellant Indian LPG Cylinders challenging the order of the Commissioner (Appeals) dated 5-7-2004 upholding the Order-in-original dated 30-1-2003 by which the Deputy Commissioner rejected refund claim of Rs. 6,69,066/- made by the appellant. This appellant had supplied gas cylinders to Bharat Petroleum Corporation Limited (BPCL) from 1-7-1999 to 31-10-2000 on a provisional contract price. BPCL had thereafter revised the provisional price by their letter dated 31-10-2000 with effect from 1997. The appellants, therefore, preferred refund claim by their letter dated 21-8-2002 claiming refund of duty of Rs. 6,69,066/-. The department thereafter issued show cause notice dated 18-9-2002 requiring the appellants to show cause as to why their refund claim should not be rejected on the ground that the appellant was well aware of the fact and it should have made a request for provisional assessment since price was subject to change in future and that the claim for the entire period filed on 27-8-2002, being after a lapse of more than one year from the date of the invoice, was time barred. It was alleged that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xcess duty was paid. It was found that the assessee was duty bound to make a request for provisional assessment under Rule 9B and that not being done, the claim could not be entertained. He relied upon the ratio of the decision in A. Infracture Ltd. v. CCE. Jaipur, reported in 2000 (117) E.L.T. 583, in support of this conclusion. He also relied upon the decision in the case of Rajasthan Cylinders Containers Ltd. v. CCE, Jaipur, reported in 2004 (166) E.L.T. 474, holding that discussing the identical issue, the Tribunal has held that mere mention in the RT-12 return that there is provisional assessment, does not make the assessment provisional. The Tribunal rejected the appeal on the basis of the decision of the Apex Court in Metal Forgings case reported in 2004 (166) ELT-474 (sic) in which it was observed mere mention in RT-12 return that there is a provisional assessment in respect of the specific invoices, does not make the assessment provisional and there has to be an order under Rule 9B of the Rules and material to show that the goods were cleared n the provisional basis. 4. In Appeal No.E/5177/04, the appellant Tirupati LPG Industries Limited has challenged the orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er duty so charged from HPCL had subsequently been refunded to them as a consequence of downward revision of prices. It was held that in the present case, it was nowhere submitted that they had not passed on the full incidence of duty and that it was not a case of unjust enrichment. The refund claim was, therefore, rejected. The Commissioner (Appeals) by his order dated 5-7-2004 held that this case was not a case of provisional assessment and that the decision of the Tribunal in Telephone Cables Ltd. v. CCE, reported in 2003 (154) E.L.T. 237 on which the appellant had placed reliance, was to be considered as over-ruled in view of the Larger Bench and the Supreme Court decisions, referred to, by him. It was also held that undisputedly, the appellant has not produced any documents evidencing that the case was not hit by the provisions of unjust enrichment. The appeal was, therefore, dismissed. 5. In Appeal No. E/5178/04, the same appellant Tirupati LPG Industries Limited has challenged the order-in-appeal made by the Commissioner (Appeals) on 5-7-2004, confirming the order of rejection of refund claim which was made on 21-2-2002 for a sum of Rs. 2,70,380.49 in respect of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment should have been treated as provisional and, therefore, when the prices by the oil companies came to be fixed, the appellants became entitled to claim refund on the basis of such downward variation which was made in their respective cases. According to the appellants, the Commissioner (Appeals) had erroneously relied upon the decision of the Tribunal in Rajasthan Cylinders and Containers Ltd. v. CCE, reported in 2004 (166) E.L.T. 474 and the decision of the Apex Court in Metal Forgings (Supra). It was contended that the Deputy Commissioner had earlier on 13-2-2001 informed the appellants that refund claims were premature as the sale price of cylinder given by the IOC, HPCL and BPCL were provisional and had directed the appellants to file their refund claim on finaiization of the prices. It is contended that the letter of the Deputy Commissioner dated 13-2-2001 should be treated as an order under Rule 9B of the Rules by which the earlier prices were taken to be provisional, and substantial compliance of Rule 9B was established. Relying upon the decision of the Tribunal in Telephone Cables Ltd. v. CCE, reported in 2003 (154) E.L.T. 237, it is contended that even if the pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irtue of Section 12B, there was presumption that full incidence of duty has been passed on to the buyer by the appellants and, as held by the authorities, it was not established that excess amounts recovered by way of excise duty were returned by the appellants to the oil companies by any process, such as, deduction in future bills. It was finally submitted that the authorities below have rightly held the refund claim filed beyond one year of the payment of duty as time barred. 8.1 The learned Authorized Representative for the department relied upon the following decisions in support of his submissions :- (a) The decision of the Tribunal in Jay Prestressed Products Ltd. v. CCE, Lucknow, reported in 2001(131) E.L.T. 123 ( Tri.-Del.) was cited to show that where the assessee has not requested for provisional assessment, the Tribunal rejected the contention that the assessments are to be taken to be provisional because of the price variation clause in the contract of the assessee with the Railway. (b) The decision of the Tribunal in CCE, Nagpur v. Maharashtra Cylinder Ltd., reported in 2003 (157) E.L.T. 688 (Tri.-Mum.) was cited for the proposition that in the absence of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tribunal, therefore, following the judgment rendered in CCE, Nagpur v. Maharashtra Cylinder Ltd., reported in 2003 (157) E.L.T. 688 and decision of the Tribunal in MRF Ltd. (Supra), held that the claim of the appellant was rightly rejected on the ground that there was no provisional assessment and subsequent reduction in the price cannot be a subject of refund. (f) The decision of the Supreme Court in Metal Forgings v. Union of India, reported in 2002 (146) E.L.T. 241 (S.C.), was cited for the proposition that to establish that the clearances were made on a provisional basis, there should be first of all an order under Rule 9B of the Rules and then material to show that the goods cleared on the basis of said provisional basis, and in payment of duty was also made on the basis of said provisional classification. (Paragraph 12). The decision of the Supreme Court in CCE, Calcutta v. Hindustan National Glass Indus. Limited, reported in 2005 (182) E.L.T. 12 (S.C.) was cited to show from paragraph 18 of the judgment that ratio of the decision in the case of Metal Forgings (supra) was reiterated. (g) The decision of the Supreme Court in MRF LTD. v. CCE, Madras, reported ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reduced to Rs. 645/- with effect from 1-7-1999, and appellant Indian LPG Cylinders by communication dated 29-1-2001 addressed to the Deputy Commissioner, made a refund claim of Rs. 7,95,796/- being an amount of excise duty deducted from their bills due to reduction in sale price in respect of 97525 LPG cylinders supplied to the BPCL for the period from 1-7-99 to 31-10-2000. It will be noticed that in the said communication, it was stated that refund claim was filed within the stipulated time under Section 11B of the Act. There was no mention of any provisional assessment in the said communication. The said appellant received a reply dated 13-2-2001 that the refund claim was premature as sale price was provisional and not yet finalized. It was, however, mentioned that the Deputy Commissioner overlooked the fact that by communication dated 31-10-2000, the earlier provisional basic price was reduced to Rs. 645/- with effect from 1-7-1999 and that the said price was to be considered as provisional basic price with effect from 1-11-2000. This letter and subsequent similar letters have been strongly relied upon to contend that the previous assessment was a provisional assessment. Therea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le 9B of Rules, 1944 was in force till 30-6-2001 and from 1-7-2001, Central Excise (No. 2) Rules, 2001 came into force and under the said new Rules, topic of provisional assessment was dealt with by Rule 7. Thereafter, Central Excise Rules, 2002 came into force on 1-3-2002 superceding the Central Excise (No. 2) Rules, 2001 and even in Rules of 2002, topic of provisional assessment was dealt with by Rule 7 which operated from 1-3-2002. The provisions of erstwhile Rule 9B were substantially different from Rule 7 of the new Rules on the topic of provisional assessment of duty. As per Rule 9B, in the contingencies contemplated by clauses a, b and c of sub-rule (1) thereof, the proper officer was required to apply his mind and reach the requisite satisfaction about the due observance of the conditions contemplated therein and direct either on a written request of the assessee or on his own accord i.e. suo motu that the duty leviable on such goods shall, pending the production of such documents or furnishing of such information or completion of such test or inquiry, be assessed provisionally at such rate or such value as may be indicated by him, if the assessee executes a bond in the pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in excess of the duty finally assessed, the assessee shall pay the deficiency or be entitled to a refund, as the case may be. Under sub-rule (5) of Rule 7 of Rules, 2002, it is provided that where the assessee is entitled to a refund consequent to order for final assessment under sub-rule (3), there shall be paid an interest on such refund made as per final assessment. However, additional provision is made in sub-rule (6) of Rule 7 that such amount of refund shall be credited to the fund unless it is relatable to the duty of excise paid by the manufacturer if he had not passed on the incidence of such duty to any other person, in which case it will be paid to such applicant. Thus, for the period covered under sub-rule (6) of Rule 7, besides question of limitation, further question would arise for examining whether the applicant was entitled to be paid refund amount of excise duty instead of crediting it to the fund. These provisions of Rules have relevance to Section 12B of the Central Excise Act, 1944 which raises a presumption that the incidence of duty has not been passed on to the buyer unless contrary is proved by the assessee. Section 12C of the Act provides for establishing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellant Indian LPG Cylinders was clearly time barred and the impugned order made against this appellant rejecting the refund claim is, therefore, fully justified and requires to be upheld. 12. As regards Excise Appeal No. 5178/04 of the appellant Tirupati LPG Industries Limited, it appears from the record that a portion of the refund claim to the extent of Rs. 32,574.45 was time barred because the invoices relevant to the said amount were issued on 31-1-2001, as detailed in the impugned order. According to the Adjudicating Authority, the claim for refund was made on 21-2-2002 i.e., after a lapse of one year from the date of these six invoices dated 31-1-2001. Therefore, to the extent to which the authorities below have rejected the claim of this appellant in respect of the amount of Rs. 32,574.45, the impugned order is required to be upheld for the aforesaid reasons. 13. In Excise Appeal No. 5177/04 of the appellant Tirupati LPG Industries Limited, the claim of refund of Rs. 55,778.42 was made by the application dated 21-2-2002 in respect of the cylinders supplied during the period from 28-4-2001 to 19-5-2001. Therefore, the claim for the said entire period made on 21-2-2002 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the question whether duty which was recovered on the basis of the provisional price was actually, to the extent of excess amount, deducted by the oil companies from future bills. This ought to have been examined because, there is a communication of the oil companies on the record that such excess amounts were to be adjusted. It would, therefore, be necessary for the Adjudicating Authority to consider the matter afresh in these two appeals of Tirupati LPG Industries Limited (Excise Appeal Nos. 5177 and 5178/2004) in respect of the claim for refund which relates to the period which is within the period of limitation prescribed under Section 11B. In appeal No. E/5177/04, since the entire claim for refund was within the prescribed period of limitation, that will have to be so considered, while in appeal No. E/5178/04 only claim from 21-2-2001 to 15-3-2001 which was made within one year by the application dated 21-2-2002 will have to be reconsidered, since the rest of the claim of Rs. 32,574.45 was rightly held to be time barred. 14. For the foregoing reasons, the following order is made in these appeals:- (1) Appeal No. E/5176/04 of the appellant Indian LPG Cylinders is dis ..... X X X X Extracts X X X X X X X X Extracts X X X X
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