CESTAT orders Excise Duty Refund not hit by unjust enrichment on Production of CA Certificate to prove duty not passed on to Customers [Read Order]

The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) ordered excise duty refund not hit by unjust enrichment on production of Chartered Accountant ( CA ) certificate to prove duty not passed on to customers.

The assessee, M/s. Deepak Cables India Ltd, is engaged in the manufacture of ACSR Conductors and filed a refund claim for Rs. Sixty lakhs towards downward price revision based on the negative supplementary invoices raised to M/s. Power Grid Corporation India Limited (M/s. PGCL).

The refund claim was returned to the assessee for defects and the same was resubmitted along with a Chartered Accountant Certificate and a Show Cause Notice was issued to the assessee proposing to reject the refund claim, on the ground of unjust enrichment.

The Commissioner (Appeals) concluded that as per the certificate issued by the Chartered Accountant, the amount of duty paid was kept as receivables from the Government in the books of account of the assessee and hence the bar of unjust enrichment has been satisfied.

The Counsel for the appellant submitted that the certificate issued by M/s. PGCL would show that M/s. PGCL has not reimbursed to the assessee the amount of excess duty on negative price variation. The Counsel argued that the assessee has sufficiently proved that they have shouldered the burden of excess duty. The department ought to have sanction the refund.

The Counsel for the Department argued that the Chartered Accountant Certificate cannot be the basis to hold that the incidence of duty has not been passed and prayed that the appeal filed by the department may be allowed and the appeal filed by the assessee may be dismissed.

The Coram consisting of CS Sulekha Beevi, Judicial Member and Vasa Seshagiri Rao, Technical Member observed that we are able to hold that the refund is not hit by unjust enrichment. The assessee is eligible for refund on merits as well having satisfied the test of unjust enrichment.

To Read the full text of the Order CLICK HERE

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