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TMI Blog2015 (11) TMI 371X X X X Extracts X X X X X X X X Extracts X X X X ..... 9.2002 and the officers seized the goods manufactured by the appellant. as according to the Department, the value was to be determined under section 4A. As the appellant apprehended recurrence of such coercive steps, the appellant applied for provisional assessment under Rule 7 of Central Excise Rules, 2002. Thereupon a show cause notice dt.27.9.2002 was issued to the appellant to show cause as to why the application for provisional assessment should not be rejected. 3. Upon this, the appellant filed writ petition No.6280/2002 dt.11.11.2002 before Honble Madhya Pradesh High Court at Jabalpur. The writ petition was posted for hearing on 15.11.2002. Meanwhile on 13/11/02 the Assistant Commissioner passed an order rejecting the request for provisional assessment and deciding the issue of valuation on merits holding that duty was payable on the value determined section 4A of the Act and not on the transaction value determined under section 4 of the Act. 4. The Writ petition which was then pending before Honble High Court was disposed of by taking into account the submissions made by both sides before the Honble High Court. In para 7 and 8 of the judgement, Honble High Court has c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to show cause as to why the claim for refund should not be rejected on the ground of unjust enrichment. The Assistant Commissioner after adjudication, vide Order-in-Original dt.16.3.2005 rejected the refund claim holding that it is hit by the bar of unjust enrichment. 8. The appellant then filed an appeal before the Commissioner (Appeals) and vide order dated June, 2005, the Commissioner (Appeals) upheld the rejection of refund claim. Aggrieved by this order of the Commissioner (Appeals) rejecting the claim for refund of differential duty, the appellant is now before us. 9. The learned Counsel for the appellant contended that the appellant is entitled to refund of differential duty paid under protest. The argument advanced by Shri Ravinder Narain, the learned Counsel for the appellant was twofold. Firstly, that there was specific undertaking/agreement between the appellant and the department before the Honble High Court while disposing of the writ petition No.6280/2002 and in pursuance of such agreement recorded in the order of the High Court, the appellant is entitled for refund. Secondly, as per Sourcing Agreement entered into between the appellant and HLL, the differential du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... measure would be returned. On the basis of the aforesaid arrangement and undertaking, in order to enable the Appellant Company to pay the said amount of differential duty, as an interim measure, HLL made the said amount available to the Appellant Company. The Appellant Company was required to take further steps to have the correct amount of duty determined and to take necessary proceedings for such determination. As such, the aforesaid amount of differential duty was made available by HLL to the Appellant Company, as an advance, on returnable basis, pending determination of the correct amount of duty, as aforesaid. Thereupon, the Appellant Company deposited the aforesaid amount of differential duty under protest and without prejudice to their contention as to the correctness of the demand." 6. In the above circumstances, the aforesaid amount provided by HLL to the Appellant Company were given as unsecured loan, vide clear understanding, obligation and undertaking on the part of the Appellant Company that upon final decision on merits relating to the correct amount of duty payable, the refund of differential duty so made, would be returned by the Appellant Company to HLL. 13. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tment of the excise duty paid excessively as stated by the learned counsel of the respondent. The word refund has to be read and understood as eligible refund under the provisions of law. The issue of unjust enrichment on the ground of passing on the higher duty to the customer (HLL) was not an issue before High Court. Further, the appellantt has not undertaken before the High Court that the incidence of higher duty will not be passed on to others. 15. Needless to say that to receive refund, the appellant has to be eligible for refund of duty under the provisions of law. Relevant provisions of section 11B are noticed as under:- Sub section (2) of section 11B If, on receipt of any such application, the [Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise] is satisfied that the whole or any part of the [duty of excise and interest, if any, paid on such duty] paid by the applicant is refundable, he may make an order accordingly and the amount so determined shall be credited to the Fund : Provided that the amount of [duty of excise and interest, if any, paid on such duty] as determined by the [Assistant Commissioner of Central Excise or Deputy Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he manufacturer has to establish that the incidence of such duty has not passed on to any other person. If the incidence of duty is passed on to any other person, the claim of refund would be hit by the bar of unjust enrichment. The provision of law as stated above makes it clear that it is burden of the appellant/applicant to establish that the incidence of duty has not been passed on any other persons. In view of sub-section (3) of section 11B, the first leg of argument of the appellant fails. 17. Let us now proceed to analyze whether the claim for refund of duty is hit by the bar of unjust enrichment. The appellant is a contract manufacturer for HLL. According to the appellant, the Sourcing Agreement entered into with HLL stipulates that excise duty paid by the appellant on manufacture of products is to be reimbursed by HLL. A copy of Sourcing Agreement dt.10.1.2003 has been produced alongwith additional affidavit filed on 5.1.2015. 18. The goods manufactured by the appellant was sold to HLL in terms of the agreement entered into between them. HLL in turn sells the products to redistributors/stockist, who are large wholesalers of the various confectionary products and other pr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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