Y.K. Sabharwal, J. - (1.) The appellant is a manufacturer of industrial fabrics. It is claimed that the said fabrics have to be dipped in a solution of Resorcinol Formaldehyde Latex Solution (RFL solution) in order to achieve a good adhesion of rubber to such fabrics. The appellant manufactures Resorcinol Formaldehyde solution (RF solution) by mixing Resorcinol and Formaldehyde in the presence of Sodium Hydroxide and water and consumes the same in the manufacture of RFL solution, otherwise known as 'dipped solution'. The appellant paid excise duty on RF solution which is stated to have been captively consumed in the manufacture of dipped solution used for the manufacture of dipped fabrics.
(2.) The claim of the appellant that RF solutions are not 'goods' under Section 3 of the Central Excises and Salt Act, 1944 (for short 'the Act') and, therefore, not subject to any central excise duty was initially rejected by the concerned Assistant Collector of Central Excise. The result was that pending the appeal proceedings the appellant paid the excise duty under protest. This controversy was, however, finally decided by the Tribunal by order dated September 25, 1990 whereby the Tribunal held that no duty was leviable on RF solutions.
(3.) As a result of the order of the Tribunal, the appellant filed a refund claim dated March 14, 1991 under Section 11-B of the Act seeking refund of Rs. 5,41,498.67 being the amount of duty paid under protest during the period from April 1, 1983 to October 20, 1986. While the application claiming refund was pending, Section 11-B was substantially amended with effect from September 20, 1991. By the same amendment, certain other provisions were also inserted in the Act including Sections 12-B and 12-C. Section 12-B provided for presumption that the incidence of duty has been passed on to the buyer. Section 12-C provided for the establishment of consumer welfare fund. It is not in dispute that these provisions were applicable to the pending applications of refund. Under Section 11-B as amended, refund could not be granted if the duty had been passed on to the customer. Under this provision, it was for the appellant to establish that the amount of duty of excise in relation to which such refund is claimed was collected from or paid by him and the incidence of such duty had not been passed by him to any other person.;