Commissioner Of Central Excise, ... vs M/S. National Plywood Industries Ltd
- CitationAppeal No. E/431/06
Ratio decidendi
The rule this decision rests on
Where a refund of excise duty is claimed, the question whether the claimant has passed the duty burden on to its customers (unjust enrichment) must be examined on the claimant's own books of account; a chartered accountant's certificate based only on a limited review of the claimant's cost-sheet calculations does not by itself establish that the refund was not passed on, and the adjudicating authority must make independent findings after examining those accounts. Where the duty claimed as paid on one product may in fact represent duty paid on another captively consumed product, the claimant must show from its records how the duty paid on the captively consumed product was accounted for, and the refund claim cannot be allowed merely on the strength of a cost-sheet entry describing a combined duty amount. Where the record does not establish whether the duty was paid under provisional assessment, the question whether unjust enrichment applies must be decided on that factual determination, and the matter is to be remanded to the adjudicating authority for fresh consideration after affording a personal hearing.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
Miscellaneous Application NO.MA-406/12 & Appeal No. E/431/06 Cross Objection No.CO-09/06 (Arising out of the order in Appeal No. 30/CE(A)/GHY/2006 dated 16.03.2006 passed by the Commissioner of Central Excise, Dibrugarh
FOR APPROVAL AND SIGNATURES OF
DR. D.M.MISRA, HONBLE JUDICIAL MEMBER SHRI H.K.THAKUR, HONBLE TECHNICAL MEMBER
1. Whether Press Reporters may be allowed to see : the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the : CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not ?
3. Whether Their Lordships wish to see the fair copy : of the Order? 4. Whether Order is to be circulated to the Departmental : Authorities?
Commissioner of Central Excise, Dibrugarh
APPLICANT(S) VERSUS
M/s. National Plywood Industries Ltd ...RESPONDENT (S)
APPEARANCE:
SHRI A.K.RAHA, SPL.COUNSEL FOR THE REVENUE SHRI K.K.BISWAS, ADVOCATE FOR THE RESPONDENT
CORAM:
DR. D.M.MISRA, HONBLE JUDICIAL MEMBER SHRI H.K.THAKUR, HONBLE TECHNICAL MEMBER
Date of Hearing: 05.10.15 Date of Decision: 05.10.15
ORDER NO. FO/A/75604/15
Per Shri H.K.Thakur
This appeal has been filed by the Revenue against the OIA No. 30/CE(A)/GHY/08 dt 16/03/2006 passed by Commissioner (A), Guwahati under which OIO dt 31/1/2005 passed by Assistant Commissioner Tinsukia Division, deciding that unjust enrichment is not applicable in this care, was upheld. Cross Objection 109 of 2006 has been filed by Respondent M/s National plywood Industries Ltd by contesting that Lower authorities have correctly held that unjust enrichment is not applicable, when chartered Accountants certificate is furnished in view of the following case laws:-
(i) Commissioner Vs Indo. Gen. Laboratories [2005(180) ELT 51]
(ii) ABB Ltd Vs Commissioner [2005(181) ELT 71.]
(iii) Commissioner Vs Marul. Udyog Ltd [2003(155) ELT 523]
(iv) Commissioner Vs Ferro Alloys Cor. Ltd [2006 (193) ELT 563]
Misc Application No. 406/12 has been filed by the Respondent for making additional grounds that during relevant period unjust enrichment was not applicable as per Apex Courts order in the case of Commissioner of Central Excise Vs TVS Suzuki Ltd [2003(156)ELT 161 (SC)] 2 Sh. A.K. Raha (Spl Council) appearing on behalf of the Appellant Revenue argued that both the Lower authorities have taken the issue of unjust enrichment in a very cursory manner when the same was so directed to be examined by CESTAT specifically under order dt 20/01/2004. That present Respondent sought refund of duty on intermediate product U.F. & P.F. Resin used captively during the period March 1982 to February 1987 on the basis of Apex Courts judgment in the case of M/s Moti Laminates [1995(76)ELT 241 (SC)] where in it was held that such aqueous solutions of UF & PF Resins are not excisable. Learned Spl Counsel brought the attention of the bench to cost sheet for plywood & Block Board (Finished Goods) of the Respondent for the year ending 31/12/1982 to argue that entire Central Excise duty of Rs. 92,22,886/- has been shown as expenditure. That as per the note, appended towards the end of this cost sheet, this duty represents the duty paid both on plywood & Block Boards. It was his case that total duty certified to be pertaining only to plywood & Block Boards could also include duty paid on captively consumed UF & PF Resins as no where it has been established by the Respondent as to how the duty paid on UF & PF Renin was accounted for in the books of accounts during the relevant period. That the issue of duty liability an Block Board was settled by Apex court on 2/03/1995 in the matter of M/s. Wood Craft Ltd and before that period duty on Block Board was not being paid. It was thus the case of the Revenue that duty said to have been paid for Block Board during 1982 to 1987 could actually be duty paid on UF & PF Resins.
3 Sh. K.K. Biswas (Advocate) appearing on behalf of the Respondent argued that order passed by both the lower authorities is correct in view of CA Certificate that duty paid on UF & PF is not recovered from the Customers. It was also his case that his additional grounds may also be allowed as unjust enrichment is not applicable in the case of provisional assessment, as per Apex Courts order in the case of CCE Vs TVS Suzuki Ltd (Supra) 4 Heard both sides & perused the case records. This matter was remanded back to the lower authorities, interalia , to examine the angle of unjust enrichment in the refund claim. Lower authorities accepted the chartered Accountants certificate & decided the refund in favour of the Respondent. It has been correctly brought out by the Revenue that CAS certificate dt 12/5/1997 was based on the checks carried out by CA on a limited Review based on the cost sheet calculation made by the Respondent company. It is also the case of the Revenue that for the period prior to 20/3/1995 duty on Block Board was not being paid and the duty claimed to have been paid on plywood & Block Board during 1982 to 1987 could be the duty paid on UF & PF Resins. For this verification the matter is required to be remanded back to the Adjudicating authority to give independent findings, after going through the Accounts of the Respondent to establish as to where the refund sought from the department, was accounted for in his books of accounts. It is also not clear from the records of this case whether the assessment of duty payment on UP & PF Resins was provisional as claimed by the Respondent in the Misc Application for additional grounds. In view of the above observations the matter is remanded back to the Adjudicating authority for denovo consideration on the issue of involvement of unjust enrichment after affording an opportunity of personal hearing. Respondent should also produce all the relevant records before the adjudicating authority to the effect that refund sought from the department was reflected as amount receivable in his books of accounts and that duty said to have been paid an Block Board did not represent duty element paid on UF & PF Resins.
5. In view of the above observations appeal filed by the Revenue is allowed by way of remand to the Adjudicating Authority. Cross objection & Misc. application for additional grounds filed by the Respondent are also disposed of.
(Operative part of the order was pronounced in the open court.)
(D.M.MISRA) (H.K. THAKUR) JUDICIAL MEMBER TECHNICAL MEMBER
Tushar kumar
1
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