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TMI Blog2017 (1) TMI 1225X X X X Extracts X X X X X X X X Extracts X X X X ..... 16th September, 2016, sanctions a refund of Rs. 652,41,66,464/- as the excess duty paid and claimed by the petitioner claimant, but the impugned order directs that this sum shall be credited to the Consumer Welfare Fund in terms of clause / para (d) of the first proviso to section 11B(2) of the Central Excise Act, 1944, read with section 12B of the said Act. The refund claim is held to be hit by unjust enrichment. The refund claim and interest in the sum of Rs. 276,68,53,222 is also rejected. 2. On such a petition, Mr. Anil Singh, learned Additional Solicitor General of India raised a preliminary objection. He would submit that given the nature of the findings and which are purely factual or, in any event, factual and legal, a writ petition under Article 226 of the Constitution of India should not ordinarily be entertained. The refund claim is rejected by the Deputy Commissioner and there are multiple remedies to challenge this order. Firstly, there is a remedy to approach the Commissioner (First Appellate Authority) and eventually the Tribunal. Even if in these rounds the petitioners do not succeed, the orders of the Appellate Authorities can be impugned and challenged in substa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ance was rendered to the authorities by producing various documents but also in law. 5. It was submitted that there is no requirement to show the liability on the debit side of the Profit & Loss Account and to show and prove a loss and even that aspect has been included in the Tribunal's order. In these circumstances, relying upon the judgment of the Hon'ble Supreme Court in the case of Commissioner of Central Excise vs. Allied Photographics (India) Limited (2004) 4 SCC 34, it is submitted that this writ petition be entertained. 6. Apart from contending and on the general principles that maintainability of writ petition in the teeth of multiple remedies which may be equally efficacious has to be determined by not assuming an absolute bar. It is submitted that the Hon'ble Supreme Court in the case of Aircel Limited vs. Commercial Tax Officer, Writ Petition Nos.1055 and 1057 of 2013, decided on 22nd April, 2016, held that when there are pure questions of law they could be gone into in writ jurisdiction. Once these are pure questions of law, then, we cannot invoke the bar nor can refuse to entertain the writ petition. 7. Reliance is also placed upon an order passed by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itioner before us had been engaged in a prolonged legal battle. That prolonged legal battle ended with the case of the assessee being accepted. How that battle commenced and ended is pointed out in a communication dated 4th November, 2015, copy of which is to be found at page 123 of the ACC petition paper-book. It is stated that the denial of the benefit of exemption notification resulted in an appeal before the Commissioner (Appeals), Central Excise, Chandigarh. There was an order passed on 29th September, 2005, denying the benefit of Notification 67/1995. Therefore, an appeal was filed before CESTAT and the claim is that the assesseepetitioner started paying duty under protest as no stay of the demand was granted. The CESTAT order dated 7th March, 2006, is the final order. Being aggrieved thereby the assessee carried the matter to the Hon'ble Supreme Court of India and Civil Appeal No.2912 of 2006 was decided on 21st August, 2015. The order of CESTAT was set aside and it was held that the product "clinker" which was captively consumed is covered by this Excise Notification. It is based on the final order of the Hon'ble Supreme Court that the claim for refund was laid. It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... buyer, if he had not passed on the incidence of such duty to any other person; (f) the duty of excise borne by any other such class of applicants as the Central Government may, by notification in the Official Gazette, specify : Provided further that no notification under clause (f) of the first proviso shall be issued unless in the opinion of the Central Government, the incidence of duty has not been passed on by the persons concerned to any other person. ... ... ... " 11 The argument is that the first proviso to sub-section (2) of section 11B and which states that the amount instead of being credited to the Fund be paid to the petitioner-applicant as such amount is relatable to the duty of excise and interest, if any, paid on such duty. Provided that duty is paid by the manufacturer and he has not passed the incidence of such duty and interest to any other person. What we find is that after this communication together with the related statements was received, the Deputy Commissioner addressed a deficiency memo. That deficiency memo, copy of which is at page 131, inter alia, states that the petitioner has failed to furnish all the central excise invoices showing clearanc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y, 2016, on scrutiny and verification of the application, raised certain points. He asserted that the Deficiency Memo has not been complied with in the sense that the queries and deficiencies pointed out therein are not satisfactorily replied. This round of correspondence and on this issue continued and we have before us the letter of 12th April, 2016, copy of which is from pages 147 to 149 of the paper-book. There is a set of documents annexed with all the letters. Then what we have is a communication of 15th April, 2016, relying upon the personal hearing which was held in the office of the Deputy Commissioner. During the course of hearing the Commissioner seems to have pointed out to the petitioners that the status / position of refund as reflected yearwise in the documents, namely, balance sheet, Profit & Loss Account and in audited annual financial report / statement of the respective years, was sought for. However, the said direction has not been complied with and instead a Chartered Accountant's certificate has been submitted stating that the payment has been made under protest for excise duty on clinker and that is in agreement with the entries in some ledger account. Ho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it would take some time to do so. Passing on any specific cost element, which is applicable only to the manufacturer, through the price charged which is over and above the market price generally applicable, was not possible and could not have been achieved. Any additional recovery or an attempt to pass of any burden would not be accepted by the market / consumers who may opt for any alternative in the market. It is, therefore, a clarification by the petitioner that the sum in respect of which refund is claimed, the incidence has not been passed on to or realised from any customer or from any other person. This and the other queries raised were also sought to be replied by this detailed communication which ends at page 165 of the paper-book. It is also clear that the claim for interest was sought to be amplified and clarified by relying upon further communication of the petitioner dated 25th May, 2016 and 26th May, 2016. On 26th May, 2016, it has been stated that paragraph 9 of their earlier letter clarifies the position and answers the question. Then it is stated that for the first time the Revenue is seeking to rely on section 11B relating to unjust enrichment. The submissions wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he consumers and, therefore, there is no requirement of depositing the sum to the credit of the Fund (Consumer Fund within the meaning of the statutory provision). It is on such a composite claim and which was considered by the Deputy Commissioner that the impugned order has been passed. On the basis of the claims and the stand of the Revenue, the Deputy Commissioner framed four points for his consideration. They are summarized at internal page 17 of the impugned order. The first is whether there was excess duty paid and accordingly, the subject refund claim arises and if so, then, to the extent of what amount and second is whether the subject refund claim as mentioned by him in paragraphs preceding page 17 has been filed within the time limit as prescribed in section 11B of the Central Excise Act, 1944; whether this claim of interest by the claimant in terms of section 35FF of the Central Excise Act, 1944 on the said refund claim is admissible and importantly the issue as to whether the subject refund claim is hit by the unjust enrichment aspect. Though the arguments have been canvassed by both sides and focussing on this issue what we find is that it will not be proper to pick ou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d their manufactured duty exempted cement at a price at least higher than their cost price / manufacturing expenses as mentioned in the cost duty sheet. That is how they have recovered several components of the expenses which are incurred. The reliance on the aspect of the payment of duty under protest or otherwise could be reflected from the annual audited account and that is how that is commented upon. 16. Thereafter a finding is rendered that the petitioner has passed on the duty paid on the clinker captively consumed in the manufacture of duty exempted cement to the consumers / buyers of the same. 17. It is in these circumstances that we are of the opinion that the findings rendered by the Deputy Commissioner are not only by considering some legal aspect which may arise during the course of dealing with factual matters and brought before him. These are findings rendered purely on the correctness of the approach of the petitioner-manufacturer. The basis on which the claim was made, the maintenance of accounts and practices prevailing in the market and particularly amongst manufacturers of cement are all referred to with a view to ascertain whether there is substantiation by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anvassed throughout was that questions and purely of law were raised. There is a finding of fact in paragraph 4 that as far as the legal issues are concerned, the facts brought on record and the contents of the documents are undisputed. It is in these circumstances that in the light of such undisputed facts and pure questions of law the High Court could have been entertained in writ jurisdiction. That is why the discretion exercised by the High Court was interfered with. 21. We are mindful of the fact that availability of an alternate equally efficacious remedy is not an absolute bar in entertaining a writ petition under Article 226 of the Constitution of India. It is not a prohibition but a rule of caution and prudence. Eventually everything must depend on facts and circumstances in each case. Therefore, no reliance can be placed on the decision of Aircel Ltd.'s case. 22. Even in the case of Paradip Port Trust it was undisputed that the sales tax was assessed when the argument was that there is a lack of legislative power in the State to impose sales tax. The whole argument centered around interpretation of sub clause (d) of clause 29-A of Article 366 of the Constitution of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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