http://indiankanoon.org/doc/582291/

CEA No.106 of 2007 -1-   IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH   CEA No.106 of 2007 DATE OF DECISION: February 3, 2010. M/S GMP FINISHING MILLS, AMRITSAR ...APPELLANT  VERSUS COMMISSIONER OF CENTRAL EXCISE, ...RESPONDENT JALANDHAR

"Whether it is just and fair to reject the refund claim when excise duty was paid under protest and against provisional assessment order?" 

Counsel for the appellant has argued that duty was liable to be paid in respect of galleries. It is contended that once it has been held in M/s Sangam Processors’ case (supra) that size of galleries was not to be included in the chambers for the purpose of capacity determination and no duty was liable to be paid by the manufacturer, therefore, the Revenue was liable to refund the duty paid on the galleries. On the other hand, counsel for the respondent has submitted that the appellant has not relied on any material to show that it has not collected the duty paid by it from the buyers of the goods. It is contended that refund of duty would tantamount to unjust enrichment of the appellant, as it has already recovered the duty from the buyers and would be getting the refund also, if the appeal is allowed, which is impermissible. We have heard the counsel for the parties at length. The main issue involved in the present appeal is that doctrine of unjust enrichment is applicable to the facts of the present case or not? As far as the payment of duty on the galleries is concerned, it is not in dispute CEA No.106 of 2007 that the appellant was not liable to pay duty on the same and was entitled to refund. However, before getting the refund, the appellant had to place on record sufficient material to show that it had paid the duty itself and had not passed on the burden on to his buyers. In the present case, no material has been placed on record by the appellant to show that it has not recovered the duty paid by him from his buyers and hence the appellant cannot be allowed to receive the refund as that would tantamount to unjust enrichment. Apart from the above, Section 11(B)(1) specifically provides that application for refund shall be accompanied by such documentary or other evidence, as the applicant may furnish, in order to establish that amount on duty of excise in relation to which the refund is being claimed was paid by him and the incidence of said duty has not been passed on by him to any other person. In the absence of any material to show that incidence of duty has not been passed on to any other

buyer, it would have to be presumed that the appellant has collected the duty from his customers. The appellant has failed to discharge the legal obligation as no documentary or any other proof in this regard has been adduced by it. The departmental authorities have righty relied on the judgement of the Hon’ble Supreme Court in CEA Mumbai−II vs. Allied Phogographics India Ltd., reported as 2004(166) ELT 3 (SC), wherein it has been held that doctrine of unjust enrichment could be validly invoked.

In view of the above, as the appellant has failed to prove that it has not recovered the duty paid by him from any of his customers and has thus, failed to discharge the onus, hence the appellant is debarred from taking the amount of refund as that would amount to unjust enrichment. The orders of the Tribunal as well as authorities below in directing the CEA No.106 of 2007 refund amount to be credited to the Consumer Welfare Fund is upheld.