M/S. Indian Oil Corporation Ltd vs C.C.E. Lucknow

[Arising out of Order-in-Appeal No. 42-43/CUS/LKO/2010 dated 15.09.2010 by the Commissioner of Customs, Central Excise & Service Tax (Appeals), Lucknow].

For approval and signature:

Honble Shri Ashok Jindal, Member (Judicial)

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?

M/s. Indian Oil Corporation Ltd.

M/s. Indian Oil Corporation Ltd. .Appellants

Vs.

C.C.E. Lucknow .Respondent

Appearance:

Shri S. Vasudevan, Advocate for the Appellants

Shri Amresh Jain, DR for the Respondent

CORAM:

Hon'ble Shri Ashok Jindal, Member (Judicial)

Hon'ble Shri R.K. Singh, Member (Technical)

Reserved on: 10.07.2015

Pronounced on: 22.07.2015

FINAL ORDER NO. 52311-52312/2015-CU (DB)

Per Ashok Jindal:

The appellants are in appeals against the impugned orders rejecting their refund claims on the ground of bar of unjust enrichment.

2. The facts of the case are that the appellants were paying duty on their product provisionally during the period December 1999 to February 2002 and April 2001. The Bills of Entry were assessed provisionally during the said period. Later on same were finalized in February 2009 to April 2009. Refund applications were filed in August 2009. The refund claims were denied on the premise that the appellant have failed to pass the bar of unjust enrichment.

3. The Ld. Counsel for the appellant submits that the issue is no more res entigra in the light of the decision of this Tribunal in their own case reported in 2012 (282) ELT 368 (Del). He also relied on the decision of the Larger Bench of this Tribunal in the case of C.C.E. Vadodara Vs. Panasonic Battery India Co. Ltd-2014 (303) ELT 231 (Tribunal LB). He also relied on the decision in the case of Sterlite Industries (India) Ltd. Vs. C.C. Tuticorin-2008 (223) ELT 633 (Tri-Mad). To say that the provisions of section 18 (4&5) of Customs Act has been introduced w.e.f. 13.07.2006. Therefore, for the provisional assessment prior to 13.07.2006, the bar of unjust enrichment are not applicable. In alternate he further submits that in their own case reported in 2011 (263) ELT 698 (Tri-Amd) this Tribunal held that when the price is controlled by the Government system the assessee would have passes the incident to pay to the customer is neither reasonable nor logical. Therefore, appellant has passed the bar of unjust enrichment and they are entitled to refund claim. In these terms, it is prayed that impugned order be set aside and appeals be allowed.

4. On the other hand Ld. AR opposes the contention of the Ld. Counsel and he relied on their own case wherein the final assessment has been done prior to 13.07.2006 but in the cases in hand the final assessment for Bills of entry has been done prior to 13.07.2006 at the relevant time and finalization of assessment. The provisions of section 18 (4&5) of Customs Act were not in force. Therefore, the said case law is not relevant to the facts of this case. He further submits that the appellant have contested the issue before the Adjudicating Authority by filing the refund claim along with various documents to establish that they have not passed the bar of unjust enrichment. Therefore, the lower authorities have after conducting proper investigation has found that appellant has not passed the bar of unjust enrichment and their refund claim is rightly rejected by the lower authorities. He further submits that the decision of Panasonic Battery India Co. (Supra) is not relevant to the facts of this case as in that case provisions of Rule 9B (5) were made effective on 25.06.1999 whereas in this case provision of section 28 were in existence.

5. Heard the parties. Considered the submissions.

6. In this case the issue before us for deciding is as under:

Whether the bar of unjust enrichment is applicable to the cases wherein assessment has been finalized after 13.07.2006 but the provisional assessment has been made prior to that under the Customs Act or not. A similar issue came up before the Larger Bench of this Tribunal in the case of Panasonic Battery India Co. Ltd (Supra) which relates to the Central Excise Act wherein the provisions under Rule 9 B of the Central Excise Rules, 1994 were amended w.e.f. 25.06.1999. Therefore, the issue before this Tribunal was that whether the bar of unjust enrichment is applicable for the cases where the provisional assessment has been done prior to 25.06.1999 and final assessment has taken place after 25.06.1999. The larger bench of this Tribunal has answered the references as under:

For the period prior to 25.06.1999 unjust enrichment will not be applicable for refund arising out of finalization of provisional assessment pertaining to period prior to 25.06.1999 even if assessments are finalized after 25.06.1999.

7. We also find that in appellants own case the issue came up before the Ahmadabad Bench of this Tribunal wherein the appellant sought relief of the excess duty paid during the period April 2003  July 2003 on the grounds that the excess duty paid is Rs.6000/- per kiloliters while they are selling at administered price. But the refund claim was sought to be rejected on the grounds that the claim is hit by bar of unjust enrichment. In the said case after consideration by both the sides this Tribunal came at a conclusion that the unjust enrichment in view of the fact that price of MS petro product is being fixed by the Government. In the light of this it cannot be said that the bar of unjust enrichment would be applicable.

8. In view of the above observation we hold that in this case also price has been administered by APM regime and selling price has been fixed by the Government. Therefore, facts of appellants own case decided by the Ahmadabad Bench of this Tribunal discussed above are similar to the facts of this case. In these circumstances, we hold that bar of unjust enrichment is not applicable to the facts of these appeals.

9. In these terms, we hold that appellant is entitled for refund claim. Consequently impugned orders are set aside. Appeals are allowed with consequential relief if any.

(Order pronounced in the open court on 22.07.2015)

(R.K.Singh) (Ashok Jindal) Member (Technical) Member (Judicial)

Bhanu

5

C/618 & 619/2010-CU (DB)