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2015 (9) TMI 1080 - CESTAT NEW DELHI

2015 (9) TMI 1080 - CESTAT NEW DELHI - 2015 (329) E.L.T. 347 (Tri. - Del.) - Denial of refund claim - Unjust enrichment - Provisional assessment - Bar of limitation - Held that:- refund claim is in respect of the clearances made during the period from 10.04.01 to 21.05.2001. However, it is not in dispute that the excess duty paid whose refund has sought had been paid on 19.04.2001, 30.04.2001 and 15.05.2001. The Assistant Commissioner has taken the date of clearance as the "relevant date" under .....

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tion period.

Respondents' plea is that though the duty initially had been paid on final price which was higher than the final price, the duty reimbursement received by them from the HPCL was only of the duty payable on the final price and not of the duty paid on the provisional price which was higher. If this is so, the bar of unjust enrichment would not apply.

Just because the prices were not finalized by the respondents' customers within 3 to 4 months, the assessment cann .....

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Kumar, Member (T) And S. K. Mohanty, Member (J), JJ. For the Petitioner : Shri M SA Negi, DR For the Respondent : Shri Z U Alvi, Adv ORDER Per Rakesh Kumar The facts giving rise to filing of these appeals by the Revenue are in brief as under:- 1.1 The respondents are manufacturers of LPG cylinders which were being cleared by various oil marketing companies. During July, 1999 to October 2000 period and from 10.04.2001 to 21.05.2001 period the respondent cleared LPG cylinders to HPCL against contr .....

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and the respondent had given an undertaking in this regard. In this regard the Assistant Commissioner in his order dated 13.08.1998 finalizing the provisional assessment for the period from April 1997 to March, 1998 had observed as under:- "It is seen that M/s.Presvels Pvt. Ltd. are enagaged in the manufacture of LPG cylinders; entire supply of which is made to Government owned oil companies. Final prices are available within a period of 3 to 4 months. The party has also given an undertakin .....

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r withdrew the provisional assessment order dated 08.03.1995 and treated the assessment for 1997-98 as final on the understanding that the final prices would be available within 3 to 4 months from the date of supply and that they will pay the differential duty immediately on the final prices being available. However, it appears that during July, 1999 to October, 2000 period and subsequently during April to 21.05.2001 period, though the supplier of LPG cylinders to HPCL were made without any prov .....

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eriod from 10.04.2001 to 21.05.2001 was filed on 16.04.2002. In both the cases, the Assistant Commissioner by two separate orders rejected the quantum of refund claim which was beyond the limitation period of one year from the relevant date. Accordingly, in respect of the first refund claim for the period from July 1999 to October 2000, the refund claim of ₹ 12,67,122/- was rejected and in respect of the second refund claim for the period from 10.04.2001 to 21.05.2001, the claim of ₹ .....

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(Appeals) which was disposed of by the Tribunal vide final order No.861/2004 dated 08.10.2004 by which the Tribunal remanded the matter to the Commissioner (Appeals) for denovo decision, keeping in view its observations in the stay order. The Tribunal in para 4 of its order dated 08.10.2004 had observed that:- "We find from the record that the ld. Commissioner (Appeals) has decided the matter by presuming that the assessment of the respondents was provisional. But we do not find any specifi .....

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gly, in the denovo proceedings, the Commissioner (Appeals) was required to specifically examine as to whether there is any specific provisional assessment order passed by the competent authority under Rule 9 B of Central Excise Rules, 1944 and also examine the unjust-enrichment question in the light of the Apex Court judgment in the case of CCE, Mumbai-II Vs. Allied Photographics India Ltd. reported in 2004 (166) ELT 3 (SC) 1.5 The matter was decided denovo by the Commissioner (Appeals) vide ord .....

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r there was any specific order of the competent authority ordering provisional assessment under Rule 9 B of the Central Excise Rules, 1944, and that the Commissioner (Appeals) in the impugned order has wrongly treated the cases where the prices were not finalized, as the cases of provisional assessment, that for the periods of disputes there was no specific order for provisional assessment, that in terms of Apex Court's judgment in the case of Metal Forgings vs. Union of India reported in 20 .....

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(259) 360 (Bom.), wherein while examining the question as to whether time limit for filing refund under section 11B of the Central Excise Act would be applicable when the price at which the goods had been supplied by an assessee to its customers was provisional and the duty had been paid on self-assessment basis, Hon'ble Court held that if the procedure for provisional assessment was not followed for the impugned clearances and the records do not indicate that the clearances were affected o .....

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r section 11B - one year from the relevant date would be applicable. He, therefore, pleaded that the impugned order holding that the refund claims were not time banned is not correct. On the question of unjust enrichment, Shri Negi cited the judgment of Tribunal in the case of Sangam Processors reported in 1994 (71) ELT 989 which held that the subsequent adjustment by the assessee by issue of credit notes to the customers will not save him from the bar of unjust enrichment, and once the goods ha .....

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ngs of the Commissioner (Appeals) in para 3 (iii) of the impugned order, wherein the Commissioner (Appeals) has observed that initially on the assessees' request dated 27.05.1995, the Assistant Commissioner had ordered provisional assessment under Rule 9 B on 08.03.1995 on the ground that final prices of the goods are not available at the time of removal, that subsequently on the assessees' undertaking to pay differential duty and also their undertaking that the final prices would be ava .....

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hin 3 to 4 months and that in such cases the assessments would have to be treated as provisional. Shri Alvi also pleaded that B-13 General Bond earlier executed in March, 1995 had been discharged only on 30th May, 2002 and that bond was in existence during the period of dispute. He also pleaded that the delay in finalization of the supply price was only on account of delay on the part of the oil marketing companies to whom the LPG Cylinders were being supplied and, therefore, in such cases, the .....

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uently when the prices were finalized and the final prices were lower than the provisional prices, they received the payment only on the basis of final prices and the duty chargeable on the same, and as such the respondent have not been reimbursed the excess duty which had been paid by them and hence the Tribunal judgment in the case of Sangam Processors case would not apply. Shri Alvi with regard to the refund claim of ₹ 3,93,783/- also pleaded that in this case the duty of which refund i .....

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section 11B. 4.1 Shri Alvi, therefore, pleaded that the refund claim of ₹ 3,93,783/- had been filed well within the limitation period of one year from the relevant date. 5. We have considered the submissions from both the sides and perused the records. 6. Coming first to the refund claim of ₹ 3,93,783/-, this refund claim is in respect of the clearances made during the period from 10.04.01 to 21.05.2001. However, it is not in dispute that the excess duty paid whose refund has sought .....

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se refund has sought had been paid on 19.04.2001, 30.04.2001 and 15.05.2001, in our view, the refund claim of the duties filed on 16.04.2002 would be within limitation period and hence on this point the Commissioner (Appeal)'s order is correct. 7 Coming to the question of unjust enrichment, the respondents' plea is that though the duty initially had been paid on final price which was higher than the final price, the duty reimbursement received by them from the HPCL was only of the duty p .....

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pex Court by judgment reported in 2005 (179) ELT A 41 (SC). In the case of Universal Cylinders initially LPG Cylinders had been cleared to oil marketing companies at a provisional price on payment of duty on that price and subsequently final prices fixed were lower than the provisional price and the excess price including excess duty had been adjusted from the subsequent supplies made by the assesses and in these circumstances, it has been held by the Tribunal that the bar of unjust enrichment w .....

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. The dispute in this case is as to whether the payment of duty in respect of goods cleared during the period of dispute is to be treated as under provisional assessment, as if the assessment was provisional in terms of the provisions of section 11B, the limitation period prescribed therein would not be applicable. In this regard, the appellants' plea is that in the year 1995 on the appellants' request dated 27.02.1995 for provisional assessment the Jurisdictional Assistant Commissioner .....

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uation where on account of delay on the part of the HPCL, the prices were not finalized within 3 to 4 months, the assessment should be treated as provisional, even though there is no formal provisional assessment order and for refund of the excess duty paid during such period the bar of unjust enrichment would not apply. We do not agree with this order of the Commissioner (Appeals), as the Apex Court in the case of Metal Forgings vs. Union of India reported in 2002 (146) ELT 241 (SC) in para 11 .....

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