TMI Blog2010 (9) TMI 1021X X X X Extracts X X X X X X X X Extracts X X X X ..... the Commissioner of Customs, Bangalore demanding differential duty of ₹ 41,15,728/- on the imports made under the EPCG scheme along with interest. Before the issue of said show cause notice the appellants paid duty and interest thereon totally amounting to ₹ 72,61,371/- on 25-10-2000 itself. After issue of show cause notice, the appellants approached the Settlement Commission, Chennai, under Section 127B of Customs Act, 1962. The Settlement Commission Chennai, vide its final order No. 6/2002-Cus., dated 28-6-2002 fixed duty liability to ₹ 30,86,796/- and held that no interest is liable to be paid by the appellants. The duty amount was ordered to be adjusted against amount of ₹ 72,61,371/- paid by the appellants. In terms of the order of the Settlement Commission, appellants filed a refund claim for differential amount of ₹ 41,74,575/-. The appellants were asked to produce certain documents in support of their claim. To examine the issue of unjust enrichment, the appellants were also asked to produce Chartered Accountant s certificate with ledger extract. Subsequently, the refund claim was processed and an order-in-original No. 172/05 AC (Refunds) dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .) = 2008 (11) S.T.R. 108 (Tribunal), Toyo Engineering India Ltd. v. C.C., Mumbai - 2004 (175) E.L.T. 793 (Tri.-Mum.) and Collector of Customs, Madras v. Indo-Swiss Synthetic Gem Mfg. Co. Ltd. - 2003 (162) E.L.T. 121 (Mad.). It is his submission that the issue involved in this case is squarely covered by the decision of this Bench in the case of C.C., Bangalore v. Motorola India Pvt. Ltd. - 2006 (206) E.L.T. 370 (Tri.-Bang.) and affirmed by the High Court of Karnataka as reported at 2008 (221) E.L.T. 489 (Kar.). It is his submission that he is relying on the decision of the Bench in the case of C.C., Bangalore v. Motorola India Pvt. Ltd. (supra) for the proposition that the amount paid during the investigation is only a deposit and not a duty, and bar of unjust enrichment does not apply to it. It is his submission that Department has not adduced any evidence to the appellant s contention that the amount which has been claimed as refund by the appellant was borne by him only and not passed on to their customers. It is his submission that the burden of proof in respect of unjust enrichment is a rebuttable one and appellant has rebutted the same. For this submission, he would rely upo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellant had imported capital goods. These capital goods were put to use by them for production of manufacturing of goods exported which is evident from the fact that the fulfilment of export obligation to the extent of 25%. This would indicate that the said capital goods were never a part of the finished product and were used in the manufacturing of the final products which were exported. We find that the Hon ble High Court of Madras in the case of Collector of Customs, Madras v. Indo-Swiss Synthetic Gem Mfg. Co. Ltd. (supra) has held as under : Section 27(2)(a) and (b) of the Act is very clear that the claimant is entitled to refund, if such amount of duty is relatable to the duty paid by the importer (a) if he had not passed on the incidence of such duty to any other person; and (b) the duty on imports made by an individual for his personal use. In the case of Indo-Swiss Synthetic Gem Manufacturing Company Ltd., - the Company, in its supplemental affidavit stated in detail that silica crucibles were used in the manufacture of synthetic Gems, as refractory goods, which could withstand very high industrial temperature, which was necessary for such process of manufacture. What ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... synthetic gem, and not consumed in the manufacture of synthetic gem, inasmuch as it did not become a part and parcel whether separable or not, and it was captively used only as refractory goods, which could withstand high industrial temperature, which was necessary for such process of manufacture. What is further revealed is that the company had not directly passed on silica crucibles, as imported, to the customers or buyers. In such circumstances, we are of the view that the question of passing on the incidence of duty paid on silica crucibles did not at all arise. No doubt true it is, the conclusion arrived at by us, as above, was reached by the learned single Judge. However, we find it difficult to agree with the reasoning of the learned single Judge, and also of his view that the ratio of the decision of the Bombay High Court in Solar Pesticides Pvt. Ltd. (supra) is directly applicable to the present case, at it is possible with the views expressed therein for the reasons we immediately state. In that case, the imported copper scrap had been consumed as a raw material in the manufacture of the end produce, namely, Copper Oxychloride. It is simple economics that customs d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion. The fact that the express inclusion of such words is absent by itself is indicative of the Legislative intent in not putting any clog or restriction, as respects the passing on the incidence of duty. 5.3 It can be seen from the above reproduced ratio, their Lordship had gone into an identical issue of the refund arising out of the duty paid on the capital goods and they have held that there cannot be any question of passing of incidence of duty paid on the capital goods. The ratio of the Hon ble High Court of Madras indicates that the capital goods, if they are used for the manufacturing of final products cannot be considered as consumed in the manufacturing of the finished products. Since this is the decision of the Hon ble High Court of Madras, is binding on us, we follow the same, as the other case laws holding a different view, as cited by the learned JDR on the issue are of the Larger Bench of the Tribunal. 5.4 It can be seen that the decision of the Indo-Swiss Synthetic Gem Mfg. Co. Ltd. will apply only when an assessee is claiming the refund of the amount of duty paid on the capital goods which were used for manufacturing of finished products. In the case before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ner (Refunds) but no action was taken. In the mean time, DRI issued show cause notice alleging shortfall in meeting export obligation in respect of five advance licenses including 7001272 and 7002576. The Commissioner of Customs vide his Order-in-Original No. 11/2004, dated 27-2-2004 held that the appellant had fulfilled their export obligation under license 07001272 and ordered refund of an amount of ₹ 45,77,562/-. When the respondents requested the Asst. Commissioner to implement the Commissioner s order, the AC (Refund) rejected the claim on the ground of unjust enrichment. The respondent filed appeal No. 45/05 which was allowed by the Commissioner of Customs (A) in the impugned order dated 30-6-2005 but with interest only on expiry of three months from the Commissioner s order dated 27-2-2004 in terms of Supreme Court judgment in ITC Ltd. case reported in 2005 (179) E.L.T. 15 (S.C.) read with Board s Circular No. 802/35/2004-CX., dated 8-12-2004. The respondents in their Cross Objection claimed interest on expiry of three months from the date of making such claim. They relied on the following case laws : (a) Super Electronics v. C.C.E. - 1999 (113) E.L.T. 792 (All. ..... 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