BOMBAY CHEMICALS LTD. Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) THE issue in this case relates to rejection of claims for refund of Rs. 13,17,34,703.65 (Rupees Thirteen crores seventeen lakhs thirty four thousand seven hundred three and paise sixty five only) filed by the appellants for period from 27 -9 -1979 to 28 -2 -1994 of duty paid on Tortoise brand Mosquito Coils. The refund claims arise as a result of classification dispute - the assessee claimed the product as insecticides classifiable under Tariff Item 68 of the schedule to Central Excise Tariff Act and eligible for exemption from duty under Notification No. 55/75 dated 1st March 1975 as amended and that from 1st March 1986 the product was classifiable under Chapter sub -heading 3808.10 and chargeable to NIL rate of duty. The classification dispute was settled by the Tribunal by its order No. 260/90 -C dated 19th March 1990 accepting the contention of the assessee. The Tribunal's order was upheld by the Supreme Court on 28 -2 -94. Although the assessee had been filing the claims right from October 1980 to March 1994 as seen from the details set out below, one consolidated claim comprising 15 different claims was filed after the judgment of the Supreme Court :

(2.) ON scrutiny of the refund claim, it was noticed that the assessee had paid duty under protest and that they have specifically mentioned in the refund application that whatever duty had been paid, it had been charged and recovered from their customers. It was presumed that the incidence of duty had been passed on by the assessee to their customers and therefore show cause notice dated 12th July 1994 was issued to them proposing credit of the amount claimed as refund to the Consumer Welfare Fund as incidence of duty of excise in relation to which the refund was claimed had been passed on by them to their customers. By order dated 12th October 1995, the Assistant Commissioner held that an amount of Rs. 4,50,00,604.31 (Rupees Four cores fifty lakhs six hundred four and paise thirty one only) was barred by limitation and that an amount of Rs. 58,41,439.95 (Rupees Fifty eight lakhs forty one thousand four hundred thirty nine and paise ninety five only) was inadmissible on merits, as this amount had been availed by the assessee as Modvat credit. Regarding the amount of Rs. 8,06,92,659.39 (Rupees Eight crores six lakhs ninety two thousand six hundred fifty nine and paise thirty nine only), he held that it was admissible on merits but directed it to be credited to the Consumer Welfare Fund under Section 12C of Central Excise Act on the ground that the assessee had not discharged the burden of showing that they had not passed on duty burden to their Customers. The Commissioner (Appeals) upheld the order of adjudication; hence this appeal before the Tribunal.

(3.) NONE appears for the appellants inspire of notice; hence we heard the ld. SDR and perused the records. We find no substance in the plea raised in the appeal that the order has been passed in violation of principle of natural justice for the reason that the appellants have not substantiated their plea that during the course of hearing, the Commissioner (Appeals) directed the lower appellate authority to produce the Department's file before him and informed the appellants that on receipt of the file, they would be called for personal hearing, which opportunity was not extended to them afresh. We also note that there is no substance in the plea of the assessee that an amount of Rs. 67,79,284.95 (Rupees Sixty seven lakhs seventy nine thousand two hundred eighty four and paise ninety five only) is admissible to them on the basis of so called order dated March 1995 passed by the Assistant Collector, Thane -II Dn., who sanctioned the above mentioned amount, as we find that this to be a Note Sheet order, which is unsigned and also for the reason that such order does not appear to have been issued to the appellants. On examining the claim of the appellants to refund, it is noticed that the assessee had raised a plea that they had paid the duty under protest during the entire period in dispute. Even if it is accepted that for a certain period the duty was paid under protest, it will not protect the assessee against the bar of unjust enrichment in the light of the Apex Court decision in the case of Commissioner of Central Excise, Mumbai -III v. Allied Photographics India Limited