The Ahmedabad bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that the refund claims relating to the finalization of provisional assessment are not covered under the ambit of Section 11B of the Central Excise Act, 1944.
The appellant, M/s India Gelatin & Chemicals Ltd, has claimed that the product di-clacium phosphate of animal feed grade merits classification under heading 2302 of the Central Excise Tariff Act and is therefore chargeable nil rate of duty whereas revenue claim that the said goods are classifiable under Heading No 2835 and was chargeable to central excise duty. Based on this, the department made a provisional assessment.
On appeal, the appellant succeeded and claimed for refund. The department held that the refund in terms of Section 11B in as much as they had examined that there was unjust enrichment as well as limitation.
On appeal, the Commissioner (Appeals) in his order stated that the test for unjust enrichment was done in terms of the direction of the Tribunal in its order A/596/WZB/05/CI/EB dated 03.10.2005.
Member (Judicial), Mr. Ramesh Nair and Member (Technical), Mr. Raju held that “It is also noticed that proceedings arising out of filing of refund claim culminated with presumed finalization of provisional assessment as concluded in the order of Deputy Commissioner dated 05.03.2008 whilegranting part of the refund claim. Thereafter on 01.05.2008 the appellant instead of challenging the said order in original filed a fresh claim for refund of interest. Relying on the CBEC Circular No 670/61/2002-CX/1 dated 01.10.2002. Another SCN was issued wherein it was held that the refund arising on account of finalization of provisional assessment under Rule 9 B are not governed by the provisions of section 11B. It is seen that this view is in harmony with the observation of Hon’ble Apex Court in the case of Maftlal Industries (Supra).In this regard the observation of the jurisdictional High Court in the case of Contemporary Packaging Technologies P Ltd.(Supra) also becomes relevant wherein it is categorically observed that the provisions of Section 11B of the Central Excise Act would not govern the grant of refund claims arising on account of finalization of provisional assessment under rule 9B of Central Excise, 1944.”
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