Oil and Natural Gas Corporation Limited Vs Commissioner of GST & Central Excise (CESTAT Chennai)
CESTAT Chennai held that refund claim of Education Cess (EC) and Secondary and Higher Education Cess (SHEC) on Oil Industry Development Cess (OID Cess) u/s 11B of the Central Excise Act, 1944 duly available as proved that burden of OID cess is not passed on to the buyer.
Facts- The appellants are engaged in manufacture of crude oil falling under Chapter sub-heading 29094000 of CETA 1985. Appellant filed refund claim on 04.02.2014 for an amount of Rs.19,13,96,099/- being the Education Cess (EC) and Secondary and Higher Education Cess (SHEC) paid by them on the Crude Oil Cess during the period from July 2004 to December 2013. The refund claim was filed consequent to the clarification issued by CBEC vide Circular No.978/2/2014 CX dated 07.01.2014.
Show cause notice dated 18.10.2014 was issued to the appellant proposing to deny the refund claim alleging that the same is hit by limitation as well as the doctrine of unjust enrichment. After due process of law, the original authority held that the refund is barred by limitation as well as is hit by the doctrine of unjust enrichment. Against this order, the appellant filed appeal before Commissioner (Appeals) who upheld the same. Hence this appeal.
Conclusion- Held that refund of Education Cess and Secondary and Higher Education Cess paid by the assessee for the period July 2004 to December 2013 was sought as refund under Section 11B of Central Excise Act, 1944. The refund application was filed on the basis of the very same CBEC circular dated 07.01.2014. In para-11 of the Order-in-Appeal, the Commissioner (Appeals) has observed that the price has been remained same even after the hike of OID cess and that this proves that burden of OID cess is not passed on to the buyer.
Held that we therefore are convinced that the appellant has established that they have not passed on the burden of EC & SHEC on OID Cess (Oil Industry Development Cess) to the buyer.
FULL TEXT OF THE CESTAT CHENNAI ORDER
Brief facts are that the appellants are engaged in manufacture of crude oil falling under Chapter sub-heading 29094000 of CETA 1985. Appellant filed refund claim on 04.02.2014 for an amount of Rs.19,13,96,099/- being the Education Cess (EC) and Secondary and Higher Education Cess (SHEC) paid by them on the Crude Oil Cess during the period from July 2004 to December 2013. The refund claim was filed consequent to the clarification issued by CBEC vide Circular No.978/2/2014 CX dated 07.01.2014.. Show cause notice dated 18.10.2014 was issued to the appellant proposing to deny the refund claim alleging that the same is hit by limitation as well as the doctrine of unjust enrichment. After due process of law, the original authority held that the refund is barred by limitation as well as is hit by the doctrine of unjust enrichment. Against this order, the appellant filed appeal before Commissioner (Appeals) who upheld the same. Hence this appeal.
2. Ld. Counsel Shri Raghavan Ramabadran appeared and argued for the appellant.
2.1 It is submitted by the Ld. Counsel that appellant is engaged in exploration and production of petroleum crude oil falling under Chapter Heading 2709 of the First Schedule to the Central Excise Tariff Act, 1985. The crude oil produced by the appellant is chargeable to NIL rate of excise duty. Appellant cleared crude oil exclusively to M/s. Chennai Petroleum Corporation Ltd. (CPCL). For this purpose, they entered into a Crude Oil Sale Agreement with M/s.CPCL. In terms of clause 9.1 of the agreement, the price payable by M/s.CPCL to the appellant is to be computed as per Schedule B of the Agreement. It is stipulated in Schedule B that the base price shall be computed based on international prices prevailing at that time. Schedule B price also includes taxes and duties specified therein i.e. applicable Sales Tax /VAT in addition to the base price.
2.2 In terms of clause 10.1 of the agreement, all taxes and duties other than taxes and duties mentioned in Schedule B shall be borne by the seller viz. the appellant. Thus all other taxes and duties which are not mentioned in Schedule B, such as Oil Industry Development Cess (OID cess) leviable under Section 15 (1) of the Oil Industry (Development) Act,1974 (OID Act, for short), Educational Cess (EC), Secondary and Higher Education (SHEC) etc. are to be borne by the appellant.
2.3 Ld. Counsel submitted that among other things, the appellant has to pay following taxes and duties on sale of crude oil sold to CPCL :
(a) VAT/Central Sales Tax payable under the Sales Tax Laws of the State;
(b) National Calamity Contingent Duty levied under Section 126 (1)
(c) Oil Industry Development Cess (OID Cess) levied in terms of Section 15 (1) of the Oil Industry (Development) Act, 1974 and collected by the Department of Revenue.
2.4 Ld. Counsel explained that in terms of Section 91 & 93 of the Finance No. (2) of the Act, 2004, Education Cess is levied and collected by the Department of Revenue on the aggregate of all duties of excise. Similarly, in terms of Section 126 and 138 of the Finance Act, 2007, Secondary and Higher Education Cess is levied and collected by the Department of Revenue on the aggregate of all duties of excise.
2.5 OID Cess is levied by the Ministry of Petroleum & Natural Gas but administered and collected by the Department of Revenue, Ministry of Finance. Since OID Cess is collected as duty of excise in terms of Section 15 (1) of the OID Act, the appellant was paying Education Cess and Secondary and Higher Education Cess on OID cess also during the impugned period.
2.6 Meanwhile, CBEC issued Circular No.978/2/2014 CX dated 07.01.2014. clarifying that EC and SHEC can be levied only on those cesses levied and collected by Department of Revenue. Pursuant to the aforesaid clarification, since OID was not levied by the Department of Revenue, the appellant realized that EC and SHEC are not payable on OID Cess on Crude Oil.
2.7 Consequently, the appellant filed a refund claim, in Form R, dated 04.02.2014 seeking refund of Rs.19,13,96,099/- being the EC and SHEC paid by them on OID Cess during the impugned period from July 2004 to December 2013.
2.8 The authorities below have rejected the refund claim on two grounds. It is stated that the appellant has filed refund claim beyond one year from the date of relevant date in terms of Section 11B of the Central Excise Act, 1944 and therefore refund claim is barred by limitation. Secondly, that the value of crude oil sold by the appellant to CPCL includes all taxes. Appellant has failed to prove with documentary evidence that EC and SHEC was not loaded into the price of the crude oil and that it was not passed on to the buyer.
2.9 Ld. Counsel submitted that even though appellant submitted documents in the nature of certificate from CPCL and other records, the department has not considered these documents.
3. On the issue of limitation, it is submitted by the counsel that limitation prescribed under Section 11B (1) is not applicable for refund of amount paid under mistake of law. The amount paid by the appellant can be considered as a deposit and therefore limitation prescribed under Section 11B is not applicable. To support this argument, Ld. Counsel relied upon the decision of the Jurisdictional High Court in the case of 3E Infotech – 2018 (18) GSTL 410 (Mad.) wherein it was held that when tax is paid under mistake of law refund is admissible irrespective of period covered by the refund application. The appellant also relied on the following decisions :
(i) AP Enterprises V CST Chennai – 2019 (6) TMI 18- CESTAT CHENNAI
(ii) Venkatraman Guhaprasad and Others Vs CGST & CE Chennai – 2019 (9) TMI 1143 – CESTAT CHENNAI.
(iii) Oriental Insurance Company Limited Vs CCE & ST, New Delhi – 2020 (1) TMI 324 -CESTAT NEW DELHI
(4) CCE Bangalore Vs KVR Construction – 2012 (26) STR 195 (Kar.)
4. On identical set of facts, the Hon’ble High Court of Gujarat in the case of Joshi Technologies International Vs UOI – 2016 (339) ELT 577 (Guj.) held that for the refund of amount paid under mistake of law the provisions of Section 11B and 11BB would not apply. The Hon’be High Court observed that the amount so collected cannot be retained by the Government in terms of Article 265 of the Constitution of India. The time limit prescribed under the Limitation Act, 1963, if considered, the period has to be computed from the date when the mistake was discovered in terms of Section 17 of the Limitation Act,1963 and then the refund claim would be well within The decision in the case of Joshi Technologies International (supra) was followed by the Hon’ble High Court of Gujarat in the appellant’s own case as reported in ONGC v UOI – 2017 (354) ELT 577 (Guj.) wherein the issue was refund of the OID cess itself.
5. The Ld. Counsel submitted that appellant was under bonafide belief that EC and SHEC were liable to be paid on OID Cess also. Only after the clarification of CBEC vide Circular dated 07.01.2014 was issued, the appellant realized that the EC and SHEC are not payable on OID Cess. Appellant then filed refund claim on 02.2014 immediately and within 3 years from the date on which the mistake was known to them. Therefore the ratio of decisions of Hon’ble High Court of Gujarat in the case of Joshi Technologies International (supra) and in their own case is squarely applicable.
6. The Ld. Counsel adverted to the findings of the OIO and submitted that the authorities below have taken the view that CBEC vide letter dated 10.08.2004 had clarified that Cess is not payable and therefore the contention of the appellant that they had come to know about the mistake only after the circular dt. 07.01.2014 is not It is explained by the Counsel that the letter issued by CBEC in F.No. No.345/2/2004-TRU dated 10.08.2004 clarified inter alia that EC and SHEC are not payable on duties of excise not collected by Department of Revenue. The said circular of 2004 did not deal with applicability of EC and SHEC on duties of excise collected by Department of Revenue but levied by any other Department of the Central Government. This aspect was first clarified by the Board vide circular dated 07.01.2014 only. The same has been considered by the Hon’ble High Court of Gujarat in the case of Joshi Technologies International (supra).
7. To counter the allegation that the refund claim is hit by doctrine of unjust enrichment, Ld. Counsel asserted that the EC and SHEC paid as well as OID Cess has been borne by the appellant. The appellant had submitted the following documents to the department to prove that the EC & SHEC paid by them on OID Cess was borne by them and not passed on to its buyer i.e. CPCL :
(a) Schedule B read with Clause 10.1 of the agreement stipulates that all taxes and duties not covered in Schedule B to the agreement shall be borne only by the appellant. The EC and SHEC paid on OID Cess are not included in the Schedule B price. Therefore, the EC and SHEC paid on OID Cess are not collected from CPCL by the appellant.
(b) Certificate dated 30.04.2014 from CPCL to the effect that appellant has not recovered the EC and SHEC on OID Cess from them.
(c) Certificate dated 10.03.2015 from M/s.V. Narayanaswamy & Co., Chartered Accountants to the effect that the burden of the EC and SHEC on OID Cess has been borne by the appellant and has not been passed on to the customers or any other person
(d) Letter of the Chairman & Managing Director of the appellant dated 21.03.2012 addressed to the Secretary to the Government of India, Ministry of Petroleum and Natural Gas, clearly stating that OID Cess is not recoverable from their customers.
8. Ld. Counsel submitted that appellant had provided adequate evidence to prove that the burden of the EC and SHEC on OID Cess has not been passed on to the customers. However, the authorities below have totally ignored the above documentary evidences and wrongly concluded that the appellant has not produced the evidence to prove that the burden of EC & SHEC was borne by them.
9. In the impugned order, it is also stated that appellant has not submitted its financial records such as balance sheet, trial balance to prove that they have borne the burden of EC and SHEC on OID Cess.
10. Counsel submitted that non-production of financial records does not ipso facto prove unjust enrichment when other corroborative evidences are produced to prove that the duty burden has not been passed on. To prove this argument, Ld. Counsel relied on the decision of the Tribunal in the case of JK Tyre & Industries Ld. Vs CCE & ST Final Order No.40159/2020 wherein it was held that it is not always necessary that the amount recoverable from the government as refund has to be reflected in the balance sheet as ‘receivables’.
11. In the present case, appellant has furnished necessary documents to prove that the burden of EC and SHEC on OID Cess has been borne by them. Ld. Counsel prayed that the refund claim may be held to be eligible for sanction to the appellant and the appeal be allowed.
12. A.R. Sri R. Rajaraman appeared for the Department and supported the findings in the impugned order. Ld. A.R adverted to Section 11B of the Central Excise Act, 1944 and submitted that as per the said section the refund claim has to be filed within one year from the relevant date. The relevant date being the date of payment of duty. The appellants have filed the refund claim for the period July 2004 to December 2013. The contention of the appellant is that they had realized the mistake of paying OID Cess only after the clarification issued by the circular dated 07.01.2014. This cannot be accepted for the reason that the Board vide earlier circular dt. 10.08.2004 had issued necessary clarification. The circular dated 07.01.2014 only reiterated the earlier circular. Hence the refund claim is hit by the bar of limitation.
13. Ld. A.R adverted to Section 12B of the Central Excise Act, 1944 to argue that as per the said section every person who has issued an invoice and paid the duty of excise on any goods shall be deemed to have passed on the full incidence of such duty to the buyer of such goods. The burden is on the manufacturer to prove that the duty incidence has not been passed on to the buyer. The appellants have not produced their financial records such as balance sheet, trial balance etc. to prove that they have not passed on the incidence of duty to their customers. As the value of Crude oil per 10 BBL at which the crude oil was sold to M/s.CPCL by the appellant, includes all taxes, the burden of payment of EC and SHEC had been indirectly passed on to their buyers. Even though the appellant has produced the certificate of M/s.CPCL stating that Education Cess and Secondary Higher Education Cess has not been collected from them, they have not produced any other supporting documents to show that the incidence of duty has not been passed on to CPCL. Therefore, the authorities below have rightly rejected the claim both on the ground of limitation as well as on the bar of unjust of enrichment. Ld. A.R prayed that the appeal may be dismissed.
14. Heard both sides.
15. The issue that arises for consideration is whether the appellants are eligible for the refund of Education Cess (EC) and Secondary Higher Education Cess (SHEC) paid on OID Cess OR whether the refund claim is hit by limitation and bar of unjust enrichment.
16. The period involved is from 2004 to 2013. Refund claim has been filed on 04.02.2014. First ground for rejection of refund is that the claim is time-barred. It is the case of department that CBEC had issued earlier letter dt. 10.08.2004 whereby it was clarified the situations in which Education Cess and Secondary Higher Education Cess is not required to be paid. The Ld. Counsel for appellant has countered this allegation by submitting that the letter date 08.2004 issued by CBEC did not clarify regarding payment of EC and SHEC on OID Cess which is not levied by Department of Revenue. The letter only clarified that EC and SHEC are not payable on duties of excise not collected by Department of Revenue. The said letter of 2004 did not deal with applicability of EC and SHEC on duties of excise collected by the Department of Revenue but levied by any other Departments of Central Government. It is submitted that for the first time, the Board had clarified the non-requirement of payment of EC and SHEC on Crude Oil Cess which are levied under the Acts administered by other Departments / other than Ministry of Finance but are only collected by the Department of Revenue in terms of those Acts.
17. For better appreciation of this rival contention, the clarification issued by CBEC letter dated 10.08.2004 is reproduced as under :
“..Issue No. (4): Whether duties / cesses which either not collected as duty of excise/customs or are collected so but by a Department other than Department of Revenue, should be included for the purposes of calculation of Education Cess?
Clarication : As the Education Cess is calculated on the aggregate duties of excise/customs (excluding certain duties of customs like anti-dumping duty, safeguard duty etc.) levied and collected by the Department of Revenue, only such duties, which are (a) levied and collected as duties of excise/customs and (b) are both levied and collected by the Department of Revenue should be taken into account for calculating Education Cess.”
18. The clarification issued by the Board vide circular dated 07.01.2014 reads as under :
“2. Representations have been received from trade and field formations seeking clarification as to whether the Education Cess chargeable under Section 93(1) of the Finance (No. 2) Act, 2004 and the Secondary and Higher Education Cess chargeable under Section 138(1) of the Finance Act, 2007 should be calculated taking into account the cesses which are collected by the Department of Revenue but levied under an Act which is administered by different departments such as Sugar Cess levied under Sugar Cess Act, 1982, Tea Cess levied under Tea Act, 1953 etc.
3. The matter has been examined. A cess levied under an Act which is not administered by Ministry of Finance (Department of Revenue) but only collected by Department of Revenue under the provisions of that Act cannot be treated as a duty which is both levied and collected by the Department of Revenue.
4. It is, therefore, reiterated that the Education Cess and the Secondary and Higher Education Cess are not to be calculated on cesses which are levied under Acts administered by Department/Ministries other than Ministry of Finance (Department of Revenue) but are only collected by the Department of Revenue in terms of those Acts.”
19. It is evident that only by circular dated 07.01.2014 the Board has expressly clarified that Education Cess and Secondary Higher Education Cess are not to be collected on Cesses which are levied under other Acts but are only collected by the Department of Revenue in terms of those Acts. The appellant has filed the refund claim immediately after the issuance of the said circular.
20. Counsel has also raised a contention that when the appellant is not required to pay the EC and SHEC on OID Cess, the amount paid can be considered only as a deposit and it does not have the color or character of duty. To support this contention, Ld. Counsel has relied upon the decision of the Hon’ble jurisdictional High Court in the case of 3E Infotech (supra).
21. We have to say that it necessitated the Department to issue a circular dated 07.01.2014 clarifying the confusion as to whether EC & SHEC is to be paid on OID Cess. The amount paid by the appellant in the nature of EC and SHEC on OID Cess can then only be considered as payment made under mistake of law. The Hon’ble jurisdictional High Court in the case of 3E Infoech (supra), while considering an appeal filed by the assessee, against the order passed by the Tribunal, which upheld the rejection of refund on the ground of time bar in terms of Section 11B, held that when the tax/duty is paid under mistake of law the claim of refund cannot be barred by limitation merely because the period of limitation under Section 11B had expired. The refusal to return the amount would go against the mandate of Article 265 of Constitution of India which provides that no tax shall be levied or collected except by authority of law. The relevant discussions of the Hon’ble High Court are as under :
“3. After making the payment, the appellant realised that under Rule 6A of the Service Tax Rules, inserted w.e.f. 1-7-2012, the appellant did not have a liability to pay Service Tax. After realising this error, the appellant on 30-6-2016 made a representation to the Assistant Commissioner of Central Excise (Service Tax) Tirunelveli Division, for the refund of this tax paid by him, which was in excess of his liability.
4. While dealing with the representation of the Assessee, Assistant Commissioner, issued a show cause notice as to why the claim of refund of the Assessee as far as the sum of Rs. 4,39,683/- was concerned not be disallowed. The Assistant Commissioner was of the view that under Section 11 B of the Central Excise Act, the application for refund must be made within a period of one year from the relevant The Assistant Commissioner was of the view that the claim of refund by the Assessee insofar as it related to Rs. 4,39,683/- was barred by limitation, as the application for refund was made after one year from the relevant date.
5. In the refund order, the Assistant Commissioner allowed the refund of Rs. 5,32,772/- and disallowed the refund claim of Rs. 4,39,683/- on the ground that it was barred by limitation.
6. Aggrieved by this order, the Assessee filed an appeal to the Commissioner of Central Excise (Appeals-I), who affirmed the order of the Assistant Commissioner that the claim of the Assessee was barred by limitation, and dismissed the appeal.
7. The Assessee approached the Customs Excise & Service Tax Appellant Tribunal, against the order of the Commissioner. The Tribunal took the view, that it had an obligation to act within the four corners of law, and found no justification to condone the delay in making the application for making a refund, and rejected the appeal.
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11. A similar view has been taken by the Bombay High Court in the case of Parijat Construction v. Commissioner Excise, Nashik, reported in 2018 (359) E.L.T. 113 (Bom.), where the Bombay High Court has held as under :-
4. We are of the view that the issue as to whether limitation prescribed under Section 1 1B of the said Act applies to a refund claimed in respect of service tax paid under a mistake of law is no longer res integra. The two decisions of the Division Bench of this Court in Hindustan Cocoa (supra) and Commissioner of Central Excise, Nagpur M/s. SGR Infratech Ltd. (supra) are squarely applicable to the facts of the present case.
5. Both decisions have held the limitation prescribed under Section 1 1B of the said Act to be not applicable to refund claims for service tax paid under a mistake of law. The decision of the Supreme Court in the case of Collector of C.E., Chandigarh Doaba Co-Operative Sugar Mills (supra) relied upon by the Appellate Tribunal has in applying Section 1 1B, limitation made an exception in case of refund claims where the payment of duty was under a mistake of law. We are of the view that the impugned order is erroneous in that it applies the limitation prescribed under Section 1 1B of the Act to the present case were admittedly appellant had paid a Service Tax on Commercial or Industrial Construction Service even though such service is not leviable to service tax. We are of the view that the decisions relied upon by the Appellate Tribunal do not support the case of the respondent in rejecting the refund claim on the ground that it was barred by limitation. We are, therefore, of the view that the impugned order is unsustainable. We accordingly allow the present appeals and quash and set aside the impugned order, insofar as it is against the appellant in both appeals. We fully allow refund of Rs. 8,99,9621/- preferred by the appellant. We direct that the respondent shall refund the amount of Rs. 8,99,962/- to the appellant within a period of three months. There shall be no order as to costs.
12. Further, the claim of the respondent in refusing to return the amount would go against the mandate of Article 265 of the Constitution of India, which provides that no tax shall be levied or collected except by authority of law.
13. On an analysis of the precedents cited above, we are of the opinion, that when service tax is paid by mistake a claim for refund cannot be barred by limitation, merely because the period of limitation under Section 11 B had expired. Such a position would be contrary to the law laid down by the Honpble Apex Court, and therefore we have no hesitation in holding that the claim of the Assessee for a sum of Rs. 4,39,683/- cannot be barred by limitation, and ought to be refunded.
14. There is no doubt in our minds, that if the Revenue is allowed to keep the excess service tax paid, it would not be proper, and against the tenets of Article 265 of the Constitution of India. On the facts and circumstances of this case, we deem it appropriate to pass the following directions :-
(a) The Application under Section 11 B cannot be rejected on the ground that is barred by limitation, provided for under Section.
(b) The claim for return of money must be considered by the ”
22. The Co-ordinate Bench of the Tribunal in the case of Oriental Insurance Co. Ltd. Vs CCE & ST New Delhi – 2020 (1) TMI 324 CESTAT NEW DELHI had occasion to consider a similar issue. In the said case, a notification dated 01.03.2011 was issued exempting taxable service specified under Section 65 (105) (d) of the Finance Act, 1994 from the whole of service tax leviable thereon under Section 66 of the Act. The assessee therein paid service tax between March 2011 and November 2011 and they filed refund claim on 23.12.2013. The order passed by the authorities below rejecting the refund claim as time-barred was set aside by the Tribunal, following the decision of the Madras High Court in the case of 3E Infotech (supra) and held that when service tax is not leviable but is deposited mistakenly, the provisions of Section 11B of the Central Excise Act relating to limitation would not be applicable.
23. The very same issue was examined by the Hon’ble High Court of Gujarat in the case of Joshi Technologies International (supra). The issue in the said case was regarding refund of Education Cess and Secondary and Higher Education Cess paid on OID Cess. The Hon’ble High Court held that when the amount is paid by mistake, Revenue is duty bound to refund the amount and cannot retain it as such retention is hit by Article 265 of Constitution of India. After appreciating the circular dated 07.01.2014 and the issue of limitation as well as unjust enrichment, the Hon’ble High Court held that the petitioner therein is eligible for refund. The relevant paras read as under :
“13. The next question that needs to be addressed is the aspect of limitation. The refund application has been made in July, 2014 seeking refund of the amount paid for the period July, 2004 to April, 2014. On behalf of the revenue it has been contended that in view of the provisions of Section 11 B of the CE Act, the limitation for filing the refund claim would be before the expiry of one year from the relevant date. The expression “relevant date” is defined under clause (B) of the Explanation to Section 11 B of CE Act and insofar as the present case is concerned would be the date of payment of duty. However, as discussed hereinabove, the provisions of Section 11 B of the Act would not apply to the claim of refund made by the petitioner. Consequently, the limitation prescribed under the said provision would also not be applicable.
14. It has been further contended on behalf of the revenue, that in case the limitation prescribed under Section 11 B of the CE Act is not applicable, the general principles of limitation would apply and the limitation of three years for filing a suit would apply, whereas on behalf of the petitioner reliance has been placed upon Section 17 of the Limitation Act, 1963 to contend that this case would be governed by the said provision and hence the limitation would not begin to run till the petitioner discovered the mistake…..
15.1 The contention that the Education Cess and Secondary and Higher Secondary Education Cess having been paid by way of self assessment is not by way of a mistake, is thoroughly misconceived. The fact that despite there being no liability on the part of the petitioner to pay Education Cess and Secondary and Higher Secondary Education Cess, it has paid the same from July, 2004 to April, 2014, on the face of its shows that the same was by way of a mistake. As regards the contention that the self assessment having become final, it is not open for the petitioner to claim refund, the adjudicating authority, in the impugned order has held thus :
“No refund claim can be filed directly on the basis of C.B.E. & C. Circular dated 7-1-2014, before the pending assessment is finalised. Accordingly, for claiming any refund for the period from July, 2004 to April, 2014, on the basis of C.B.E. & C. circular dated 7-1-2014, the essential pre-condition is to first finalise the pending assessment, only then the question of any refund would arise. On verification of records, it is observed that the claimant has already self-assessed and paid the duty under Rule 6 of the CER, 2002 for the period July, 2004 to April, 2014 which is deemed to be final assessment. Hence the question of finalisation of the same does not arise. For the purpose of claiming any refund on the basis of C.B.E. & C. circular the assessment is supposed to be pending whereas in the present case the self assessment is deemed to be final assessment and hence the claim even on merits is not DXGPssibleLE
16.2 Adverting to the facts of the present case, it is the specific case of the petitioner as averred in Paragraphs 5.12 and 5.13 of the memorandum of petition that during the course of personal hearing the petitioner was given to understand that the documents submitted by the petitioner for unjust enrichment are sufficient. It is the case of the petitioner that IOCL is its sole customer, and that the petitioner had furnished a Chartered Accountant’s certificate based on the petitioner’s invoices certifying that the petitioner has not charged any Education Cess and Secondary and Higher Secondary Education Cess to its customer. In the opinion of this court, if the adjudicating authority was not satisfied with the certificate and the material produced by the petitioner, he could have called upon the petitioner to produce further documentary evidence in support of its claim that it had not passed on the incidence of duty to the purchaser. However, without affording a reasonable opportunity to the petitioner to produce documentary evidence in support of its claim that there was no unjust enrichment, the adjudicating authority was not justified in holding that there was unjust enrichment. Therefore, the finding that the petitioner’s claim is hit by unjust enrichment cannot be legally sustained.
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17.5 Applying the above decision to the facts of the present case, the petitioner has clearly shown that it has paid the amount for which relief is sought and has not passed the burden on the consumer and that if such relief is not granted, it would suffer loss. The said decision, therefore, does not in any manner come to the aid of the respondent. In the aforesaid premises, there is no need to remit the matter to the adjudicating authority for examining the aspect of unjust enrichment.
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20. For the foregoing reasons, the petition partly succeeds and is, accordingly, allowed to the following extent :
The order-in-original dated 24th November, 2014 is hereby quashed and set aside. The second respondent is directed to forthwith sanction and grant the petitioner refund of Rs. 73,60,061/- as claimed vide application dated 17-7-2014. Rule is made absolute, accordingly, to the aforesaid extent, with no order as to costs.
21. At this stage, Mr. R.J. Oza, learned Senior Standing Counsel for the respondents has requested that the operation of the judgment be stayed for a period of six weeks from today. The said request is strongly opposed by Mr. Harsh Parekh, learned advocate for the petitioners.
22. Having regard to the facts and circumstances of the case, the request is declined.”
24. Applying the ratio of decisions (supra), we are of the considered opinion that the refund claim cannot be rejected on the ground of limitation. The issue on limitation is held in favour of the assessee, and against the Revenue.
25. The second issue is with regard to bar of unjust enrichment. The appellant has produced the documents as already stated in para-7 of this order. The Department has held that the appellant has not furnished the balance sheet and trial balance and therefore has not passed the test of unjust enrichment. Ld. Counsel for appellant has submitted that they have produced the necessary documentary evidences to establish that the duty element has not been passed on to the buyer. We proceed to examine this contention.
26. On perusal of the agreement, it is seen that Schedule B gives the details as to the payment of taxes and duties. The said clause (5) of Schedule B reads as under :
“5. T&D : Taxes & Duties :
Buyer shall pay Taxes and Duties as per the formula below :
(i) For Mumbai offshore crude :
