Case Law Details

Case Name : Commissioner of Central Excise, Kolkata-VII Vs Krypton Industries (CESTAT Kolkata)
Appeal Number : Final Order No. A-334 (KOL.) OF 2011
Date of Judgement/Order : 28/10/2011
Related Assessment Year :
Courts : All CESTAT (949) CESTAT Kolkata (25)


Commissioner of Central Excise, Kolkata-VII


Krypton Industries

FINAL ORDER NO. A-334 (KOL.) OF 2011
Appeal No. E/318 OF 2011

OCTOBER  28, 2011


1. Heard both sides.

2. Revenue is in appeal against Order-in-Appeal No. 24-25/Kol- VII/2011 dated 9-2-2011 whereby Commissioner (Appeal) upheld the lower adjudicating authority’s order granting the refund.

3. Briefly stated facts of the case are that the respondent submitted a refund claim of Rs. 2,27,963/- for the deposit towards 10% of total price of exempted goods. Earlier the demand confirmed by lower adjudicating authority was set aside vide Order-in-Appeal No. 32/KOI-VII/2009, dated 17-9-2009. Consequently they filed a refund claim of the deposit. The lower adjudicating authority sanctioned the claim. The Revenue challenged the order before the Commissioner (Appeals) who also upheld the lower adjudicating authority’s order and set aside the appeal filed by the Revenue. Hence the appeal.

4. The contention of Revenue is that the respondent could not discharge the burden that the incidence of the duty has been passed on to their customers, therefore the Commissioner (Appeals) has erred in allowing the refund claim. In support of their contention they have relied upon the Tribunal’s decision in the case of CCE v. Poona Rolling Mills Ltd. 2007 (220) ELT 907 (Tri.-Mum.) and Sahakari Khand Udyog Mandal Ltd. v. CCE [2005] 1 STT 55 (SC).

5. The contention of the respondent is that it is a case of refund of deposit and not of duty therefore the question of unjust enrichment is not applicable to their case and accordingly both the lower authorities have given cogent findings, in this regard. The respondent also filed counter styled as cross objection. The respondent also placed reliance on the decision of this Tribunal in the case of Jayketan Marketing & Clothing v. CCE 2009 (240) ELT 263 (Tri-Mum.)

6. I have considered the submission and perused records. Undisputedly the respondent deposited the amount at the investigation stage and the proceeding initiated against them were dropped by ld. Commissioner (Appeals) vide his order dated 9-2-2011. It is a case of refund of deposit of duty and not a refund of duty therefore the principle of unjust enrichment which is applicable to refund of duty is not applicable in this case. So far as the Tribunal’s decision in the case of Poona Rolling Mills Ltd. (supra), the case was remanded for examining as to whether the respondents passed on duty burden to their customers. In the case of Sahakari Khand Udyog Mandal Ltd. (supra) by the Ld. A.R., while dealing with the case of rebate on excess production of sugar the Hon’ble Supreme Court held that “all the authorities below have expressly recorded a finding that the appellant-Mandal has recovered the amount from consumers and as such excise duty is passed on to consumers/customers”. In the instant case the Department could not bring out that the respondent has passed on the burden of the incidence that the deposit has been passed on to its customers. This Tribunal in the case of Jayketan Marketing & Clothing (supra) held that ‘unjust enrichment’ is not applicable where amount deposited under protest. It is not in dispute that the deposit in the instant case was made under protest and Department has not been able to bring out anything contrary. In view of the above, I do not find any reason to interfere with the concurrent findings of the lower authorities. The Department’s appeal, which is devoid of merit is dismissed and Commissioner (Appeals) order is upheld. The counter filed by the respondent, styled as Cross Objection is also disposed of accordingly.


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