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2016 (7) TMI 1022 - CESTAT HYDERABAD

2016 (7) TMI 1022 - CESTAT HYDERABAD - TMI - Refund - unjust enrichment - higher duty paid on lead acid batteries - issuance of credit notes - Held that:- The enrichment of the person, who has paid the duty and seeks refund would be unjust if he even while not suffering the burden of duty after having passed on the same to another obtains refund and retains such refund with him. There would be nothing unjust where the person who has paid duty and has not passed on that burden to another receives .....

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ecided in favor of assessee. - E/451/2010, E/475/2012, E/26586/2013 - Final Order No. A/30486-30488/2016 - Dated:- 20-5-2016 - Ms. Sulekha Beevi, C.S., Member (Judicial) and Shri Madhu Mohan Damodhar, Member (Technical) Shri Y. Sreenivasa Reddy, Advocate for the appellant Shri H.M. Dixit, Asst. Commissioner (AR) and Shri Ajit Kumar, Asst. Commissioner (AR) for the respondent. ORDER This is a set of three appeals filed by the same appellant against the same refund claim. 2.1. The brief facts of t .....

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ustoms, Central Excise & Service Tax, Hyderabad. The Commissioner(Appeals-III) in his OIA No 12/2009(H-III)(D) CE dt. 09/09/2009 (in Appeal No.08/2009(H-III)(D)CE had set aside the OIO passed by the Assistant Commissioner and directed that the issue shall be decided afresh basing on the finding given in his order by issuing a show-cause notice under Section 11 A of Central Excise Act. Aggrieved of the said OIA No. 12/2009(H-III)Ce dt. 09/09/2009, the appellants had filed appeal before Hon .....

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efore the Commissioner(Appeals-lll). The Commissioner(Appeals-III) in his OIA No. 110/2011(H-III)CE dt. 05/12/2011 (in Appeal No.75/2011(H-III)CE upheld the order of the Assistant Commissioner and rejected the appeal of the appellants. 2.3. As the Initial OIO dt. 17/12/2008 was reviewed and was ordered to be appealed against, the divisional AC/DC had issued a protective demand notice (SCN) dt. 30/09/2009 under Section 11A, treating the refund already sanctioned vide OIO dt. 17/12/2008 as erroneo .....

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no powers to remand. Another appeal No.E/475/2012 had been filed wherein this Tribunal had given stay against recovery of the refund already sanctioned to the appellant. That was a consequence of appeal filed by the Revenue against the sanction of refund. The third appeal No. E/26586/2013 has arisen as a result of the proceedings under Section 11 A of Central Excise Act, 1944 which had also been simultaneously been taken up. 3. The issue involved is whether appellant is eligible for refund in r .....

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ority's conclusion that there was no unjust enrichment was not correct, as the issue of credit notes alone does not establish that whether it is a case of enrichment. 5. As state earlier, the first appellate authority remanded the matter for de novo consideration against which the appellant has filed Appeal No.E/451/2010. In response to this remand order, the Joint Commissioner passed an order dated 22/06/2011 rejecting the refund claim on the ground that the appellant had failed to prove th .....

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d 31/05/2012 demanded recovery of this refund amount. The appeal filed by appellant against this order before Commissioner(Appeals)' was dismissed for noncompliance of order for predeposit of 50% of amount vide order dated 22/03/2013. Against this order, the appellant has filed appeal No.26586/2013. This in a nutshell is the raison d'être for these three appeals. 7. We have heard both sides. 8. In the order passed by the Assistant Commissioner dated 17/12/2008, the refund claims we .....

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ized. In other words, when there is downward revision of prices, the respondents collect only the appropriate duty from the companies and not the higher duty which they had paid to the Government. This clearly indicates that there is no unjust enrichment. Under these circumstances the refund claim appears to be proper and can be sanctioned. Initially the unit vide letter dt. 14/07/2008 requested for allowing the amount under reference as credit in their CENVAT credit account. As per the directio .....

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o price variation clause in the purchase order", remanded the matter. Surprisingly, in the said consequential de novo proceedings, the Joint Commissioner took the view that though HBL had not recovered the impugned amount from M/s. ITL, they have failed to prove that this amount have not been recovered from other customers and thus held that the case is hit by unjust enrichment. 10. We thus find that the crux of the appeals is to analyse whether it is sufficient that the refund claimant pro .....

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cerned with the actual consumer of the manufacture and product on which duty is levied. The duty is levied on the manufacturer and the quantum of duty is determined with reference to the price at which the manufacturer sells to the buyer, who, in most cases will, be a dealer, and not on the price at which that buyer in turn sells to his sub-dealer or to the retailer to the ultimate consumer. 14. Section 11B is intended to prevent a person who has paid duty or borne it initially from receiving th .....

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he goods from the manufacturer, sells to its sub-dealer who in turn may sell to a retailer who in turn ultimately may sell the same to the actual consumer. The enrichment of the person, who has paid the duty and seeks refund would be unjust if he even while not suffering the burden of duty after having passed on the same to another obtains refund and retains such refund with him. There would be nothing unjust where the person who has paid duty and has not passed on that burden to another receive .....

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