TMI Blog2013 (8) TMI 577X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of appellate order passed by Tribunal under sub-Rule (5) of Rule 9B of Excise Rules. Thus, any recovery or refund consequent upon adjustment under Sub-rule (5) of Rule 9B is not to be governed by Section 11A & 11B of the Central Excise Act. Neither the final decision under Rule 9B(5) was appealed against nor the issue was re-agitated once again after such claim was finalized. Therefore, the issue of unjust enrichment was not required to be considered. Once the Revenue does not dispute the receipt of paperboards used as input material under the cover of invoices for preparing shells by the assesse which contained duty paying particulars, the Modvat Credit cannot be denied to the assesse - Even if the assesse had agreed later on that M/s. ITC Ltd was the real manufacturer, that ipso facto would not take away its right to avail refund claim when duties were recovered from the assessee, treating it as the manufacturer at the time of recovery - the assesse had established due payment of such duties - Non-maintenance of procedure was since not the ground contested, further dwelling on that subject was unnecessary - Department was directed to refund the entire amount with interes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .4819.12, the Appellate Tribunal held that these goods were classifiable under SH No.4823.90 of the Tariff Act vide its order dated 21/12/1999. 6. The petitioner-company filed a refund claim for differential duties paid by it under protest inasmuch as the rate applicable under SH No.4823.90 was lowered by 10%. 6.1 Such refund claim of the petitioner-company was rejected by the original authority on 04.09.2001 on the ground that the petitioner-company had passed on an excess amount being claimed as refund to the customers and the refund claim was hit by doctrine of unjust enrichment. 6.2 This was challenged before the Commissioner(Appeals) which concurred with the OIO rejected such claim vide its order dated 11.12.2001. 6.3 When the petitioner approached the Appellate Tribunal against such order, Tribunal, on 29.05.2003, dismissed the petitioner's appeal on various grounds. One of which mainly is of unjust enrichment. 7. Aggrieved by such order in the present petition before this Court, the petitioner has challenged the said decision of decline of refund by way of writ petition seeking refund claim of Rs.74.39 Lacs which includes Rs.43.81 Lacs being the excess amount pai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d goods was claimed, however, no declarations under Rule 57G were filed nor the procedure as laid down under modvat rules has been observed. Relying on the decision of Mafatlal Industries Ltd. Vs. UOI reported in 1997 5 SCC 536 = 1997(89) E.L.T.247(S.C.), it is contended that the doctrine of unjust enrichment would come into play. It is also contended that it is misconceived to say that when the duty was paid under protest, doctrine of unjust enrichment would not be attracted. Respondents also sought to rely upon the decision of the Apex Court rendered in the case of Bombay Tyres International Ltd. Vs. CCE, Indore reported in 2000 (121) ELT 8 (SC), wherein the Supreme Court rejected the claim of the assessee on the ground that no material was produced to show that the duty was paid under protest and that the same was not passed on to the consumer. 8.1 The central emphasis of this affidavit-reply thus is that at the time of clearance of excisable goods as the duty paid under protest is recovered from the customers, there is a clear bar under Section 11B(1) of the Central Excise Act as provided in the decision of Mafatlal Industries Ltd.(Supra), which prohibits unjust enrichm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d and also collect the same duty from the State on the ground that it has been collected from him contrary to law. The power of the Court is not meant to be exercised for unjustly enriching a person. The doctrine of unjust enrichment is, however, inapplicable to the State. State represents the people of the country. No one can speak of the people being unjustly enriched. 10. It would be worthwhile to refer to the decision of the Delhi High Court pressed into service by the petitioner rendered in the case of Commissioner of Customs Vs. Indian Oil Corporation reported in 2012 (282) E.L.T. 368(Del.), where the substantial question of law was whether the refund under Section 18 of the Customs Act should have been granted without any application where excess duty was paid on provisional basis for refund and whether Section 18 was applicable and not Section 27 of the Customs Act. Reference in the said decision is made of the decision of this Court rendered in the case Commissioner of Customs Vs. Hindalco Industries Ltd. reported in 2008 (231) E.L.T. 36 (Guj.). Reliance is also placed on the decision of the Supreme Court rendered in the case of Mafatlal Industries Ltd. (Supra). 10. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich considered the correctness of the aforesaid two decision (of three-Judge Bench) has in Commissioner of Central Excise, Mumbai-II v. Allied Photographies India Ltd. [2004 (166) E.L.T. 3(S.C.) = 2004(4) SCC 34] held that the judgment in Sinkhai Synthetics's case (supra) was per incuriam [para 14 at page 52] and approved the decision in the later case, i.e. TVS Suzuki's case (supra). The Three-Judge bench has also taken the same view, as was taken by the Tribunal, to the effect that the doctrine of unjust enrichment is not applicable to the provisional assessment even after the finalization thereof. The point in issue in the present case is, thus, squarely covered by the three-judge, Bench decision in Allied Photographies case [2004 (66) ELT 3(S.C.) = 2004 (4) SCC 34]. In view of this, the appeals are dismissed and the order passed by the Tribunal is affirmed. No costs. 18. We may notice here that Gujarat High Court in the case of Hindalco Industries (supra) has specifically referred to decision in the case of Allied Photographies India Ltd. (supra) but the said case has not been noticed by the Bombay High Court in the case of Bussa Overseas and Properties Pvt. Ltd. (supra). ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Sub-section (2) is not applicable. In the second situation, the assessee becomes entitled to additional refund on account of appellate orders or orders passed by a court. In this situation, the assessee is under an obligation to file an application under Section 27 of the Act, the limitation period accordingly applies and doctrine of unjust enrichment is also applicable. Explanation II to Section 27 of the Act deals with the 3rd category of situations. Such situations may occur after the passing of the final assessment, on account of rectification under Section 154 of the Act or because of any other reason, as a result of which the final order suffers an amendment or change and some amount becomes refundable. As far as Section 18 of the Act is concerned, when an amount becomes refundable after a final order is passed, the same has to be refunded immediately and for this purpose the assessee is not required to move an application under Section 27 and accordingly sub-section (2) to Section 27 would not apply. It is in this situation that the legislature has intervened and has now inserted sub-sections (3) (4) and (5) to Section 18 w.e.f. 13-7-2006. These insertions obviously are no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lly been noted that this amendment became necessary because Section 18 of the Act which provides for provisional assessment of duty presently (i.e. upto 12th July, 2006) does not provide for various issues arising from the finalization of provisional assessment. Thus it becomes apparent that the amendment in question is substantive in nature when one finds that various provisions have been inserted which were not forming part of the original Section 18 of the Act as it stood upto 12th July, 2006. It is not possible to state that the provisions for payment of interest on duty short levied or entitlement to interest on duty paid in excess of the finally assessed duty can be considered to be clarificatory provisions and in the same vein the newly inserted sub-section (5) deserves consideration. Thus in effect upto 12th July, 2006 no provision existed in Section 18 of the act which would permit Revenue to invoke principles of unjust enrichment in relation to duty paid in excess, found to be so, upon finalization of provisional assessment under Section 18 of the Act. 20. Hence, the reference to provisions of Section 27 of the Act which generally deals with claim for refund of duty can ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orted 2003 (151) ELT 136, where they have delivered the judgment in identical set up of circumstances in favour of the assessee following the Supreme Court and holding that where original payment of duties were made under protest, the bar of unjust enrichment would not apply to such payments. 15. Reliance is placed on the decision of this Court rendered in the case of Dhanlaxmi Texturisers Anr. Vs. Union of India Ors. reported in 2003 (55) RLT 873 (Guj.). The same is with regard to the insistence on following its earlier decision by the Tribunal on identical issue and to depart only on giving cogent and convincing reasons for differing from its earlier views. This has been pressed into service as it is averred that Tribunal earlier granted refund in similar circumstances. 16. In light of the aforesaid legal background, facts of the instant case shall need to be examined to decide whether the Tribunal was justified in concurring with both the authorities below in denying the claim of refund to the petitioner. In the case on hand, all the three authorities have admittedly denied the refund to the present petitioner. The excise duty, in the instant case, was paid on the goods. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m ITC, that aspect does not fall under doctrine of unjust enrichment. It is needed to be noted for clarity at this juncture that Section 18 Section 27(2) of the Customs Act are pari materia similar to Section 11B Rule 9B of the Central Excise Act Rules as subsequent rulings of this Court and of Delhi High Court are sought to be relied upon. 18.2 Going by the decisions of the Apex Court in the case of Mafatlal(Supra) and the decision given in case of Hindalco Industries Ltd.(Supra) all other subsequent decisions on the issue, the refund claim of the petitioner-assessee would not be governed by the Section 11A or Section 11B of the Central Excise Act as the case may be. 19. It can be held that the assessee had paid provisional duty which got reduced on finalizing assessment, entitling the petitioner to get the refund which is payable in terms of Rule 9B of Excise Rules, 1944. It is not disputed by either side that the assessee is entitled to refund on account of appellate order passed by Tribunal under sub-Rule (5) of Rule 9B of Excise Rules. Thus, any recovery or refund consequent upon adjustment under Sub-rule (5) of Rule 9B is not to be governed by Section 11A 11 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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