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TMI Blog2013 (11) TMI 1217X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 11.06.2004 ordered for the settlement of the matter for Rs.5,55,731/-. This amount was appropriated by the Settlement Commissioner against the pre-deposit. Since after adjustment of the departmental dues as determined by the adjudicating authority and the Settlement Commission, a net unappropriated amount of Rs.10,34,880/- still remained with the Department, the appellant filed a refund claim on 4th August, 2004 for refund of this amount. This refund claim was decided by the jurisdictional Deputy Commissioner vide Order-in-Original No.10/05/12 dated 06.05.2005 by which he rejected the claim on the ground of unjust enrichment on the ground that during the year 2001-02 this amount had been shown as Revenue expense in the profit and loss account for that year as a result of which this amount would result in increased cost of the product and higher price and thus refunding the amount would result in unjust enrichment. On appeal being filed against this order before the Commissioner (Appeals), the same was dismissed by the Commissioner (Appeals) vide order in appeal dated 30th September, 2005 against which this appeal has been filed. 2. Heard both sides. 3. Shri P.R. Mullick, l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal is allowed. In this case, the amount of Rs.18.75 Lakhs was paid during investigation even before the issue of Shaw cause notice. After adjudication by the adjudicating authority and Settlement Commission the total duty liability plus penalty was determined as Rs.2,84,389 +1,00,000 + 5,55,731/- i.e. Rs.8,40,120/- which was appropriated by the respective authorities from the deposit of Rs.18,75,000/-. The refund is sought of the unappropriated amount of Rs.10,34,880/- left after adjusting the duty and penalty from the provisional deposit of Rs.18,75,000/-. This amount is not even duty and hence there is no question of applying the provisions of Section 11B and the principle of unjust enrichment for its refund. This amount should have been refunded without even refund application. 7. Even if this amount is treated as duty and section 11B is held as applicable the unjust enrichment principle would not be applicable, under the 1st proviso to section 11B (2), the refund is payable to a manufacturer only if the incidence of excise duty whose refund is claimed has not been passed on to another person. In this regard, section 12A provide that any person who is liable to pay duty of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lant before the ld. Adjudicating Authority. That Authority denied the refund on the ground that the same was hit by bar of unjust enrichment. Examining the claim, ld. Adjudicating authority issued show cause notice and upon consideration of the reply of the appellant and also examining the balance sheet pertaining to the financial year 2001-02, he reached to the conclusion of denial of refund. 11. It was admitted by the appellant through its financial statements before ld. Adjudicating authority that the amount in question was debited to the profit and loss account for the financial year 2001-02 under the head excise duty. Admittedly the amount did not appear in the balance sheet to show that the amount was deposited under protest and awaiting recovery from department. But the refund amount claimed was part of the deposit during pre-settlement stage and upon Settlement Commission passed order, the amount sought to be refunded was recovered from buyers of goods absorbing that amount through excise duty account in sales price though profit and loss account constituting the cost of manufacture. 12. The authority inferred that when the amount sought to be refunded was considered as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... FERENCE OF OPINION 14. In view of the difference in reason of decision and the decision recorded by us separately as above, below mentioned question arises for reference to the Hon'ble President for his appropriate order to resolve the difference. Registry is directed to place this matter before him:- Whether the amount in dispute charged as excise duty in the debit side of profit and loss account constituted cost of manufacture and absorbed by sale value depicted in credit side of that account bars the refund claim by doctrine of unjust enrichment and deniable? [Dictated & Pronounced in the open Court]. Per Sahab Singh : 15. I have gone through the order passed by Shri Rakesh Kumar, Member (Technical) and the order passed by Shri D. N. Panda, Member (Judicial) and difference of opinion referred to me by the President. 16. Brief facts of the case have been fairly narrated by the Ld. Member (Technical) in Para 1 of the order recorded by him and therefore I do not find any necessity of repeating the same. 17. Issue involved in the present case relates to the refund of Rs. 10,34,880/- and it is to be decided whether this amount i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... excise paid by the manufacturer if he had not passed on the incidence of such duty to any other person. 23. I also note that under Section 12 A of the Central Excise Act every manufacturer clearing the goods on payment of duty has to indicate on documents of assessment, sale invoices and other like documents the amount of excise duty which will form part of the price at which such goods are sold. This provision will not be attracted as in the present case goods are already cleared and duty is paid subsequently. Also under Section 12 B of the Act any person who paid the duty on any goods shall be deemed to have passed on the incidence of duty unless contrary is proved by that person. In this case duty involved in refund was not paid at the time of clearance of goods but subsequently during the course of investigation for the past period and therefore it is contention of the appellants that incidence has not been passed on by them to any other person. 24. I also note that duty sought to be refunded was debited in RG-23A on dated 15.09.2001. Out of the total duty of Rs. 18,75,000/- , Rs. 8,40,120/- has already been adjusted by Department against confirmed amount as per order of Set ..... X X X X Extracts X X X X X X X X Extracts X X X X
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