GTC INDUSTRIES LTD. Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) In this Appeal filed by M/s. GTC Industries Ltd, the issue involved is whether refund of duty of excise paid by them on shells and slides captively consumed in the Cigarettes is admissible to them.

(2.) We heard Shri L.P. Asthana, learned Advocate for the Appellants, and Shri A.S. Bedi, learned Senior Departmental Representative for the Revenue. The learned advocate, has submitted that the appellants manufacture Cigarette and shells and slides; that prior to 1982 shells and slides were classified under Tariff Item No. 68 of the Old Central Excise Tariff and these were exempted from payment of duty under Notification No. 1187/75 as these were captively consumed; that with effect from 1.3.82, Finance Act added new tariff item 17(4) in respect of printed cartons, boxes, containers, etc.; that the Central Board of Excise and Customs vide Circular F. No. B/11/I/82 TRU dated 4.7.82 clarified that printed shells are in the nature of printed boxes and chargeable to duty under Tariff Item 17(4) of the oiled Central Excise Tariff; that the Appellants challenged the levy of the duty and as per directions of the Department opted for provisional assessment of duty and continued paying duty under protest; that Delhi High Court allowed their writ petition No. 1563/83 on 10.11.92, the SLP No. 1737/95 filed by the Revenue against Delhi High Court's decision was dismissed by the Supreme Court vide Order dated 11.12.97; that, therefore, it became final that shells and slides continues to fall under Tariff Item 68 and were eligible for total exemption under Notification No. 118/75 -CE; that the Appellants after the decision of the Delhi High Court filed the refund claim for the period 1.3.82 to 31.3.94; that the Assistant Commissioner rejected their claim on 23.8.95 only on the ground that they could not produce the relevant duty paying documents; that on Appeal filed by them, the Commissioner (Appeals) remanded the matter to the Assistant Commissioner vide Order dated 5.2.99 for considering the refund claim for the period 1.3.82 to 23.2.86 as dispute related to the classification of goods only under the old Tariff; that the Commissioner (Appeals) also held that doctrine of unjust enrichment is not applicable; that on remand the Deputy Commissioner cannot reject the refund claim on the ground that Appellant could not substantiate their claim for refund as the same is also hit by unjust enrichment as the duty burden had been passed by them to the buyers of Cigarettes in view of the judgment of the Supreme Court in the case of Union of India vs. Solar Pesticides Pvt. Ltd. 2000 (116) ELT 401 (SC). The learned advocate, further, mentioned that the Commissioner (Appeals), under the impugned Order rejected their claim on the ground of unjust enrichment without appreciating the submissions made by them.

(3.) The learned Advocate, further submitted that the Supreme Court recently in the case of CCE, Madras vs. ITC Ltd. Bihar etc. has held vide Order dated 6.2.2003 in Civil Appeal No. 12043 -54 of 1995 that "a Cigarettes packet containing shells and slides covering all sides would be a box." He contended that for becoming box, it is therefore necessary that there should be both shells and slides and it has to be ascertained by the Department whether shells and slides were cleared by the Appellants in the present matter separately or together. On the aspect of unjust enrichment, learned Advocate submitted that the Commissioner (Appeals) Vadodara under order -in -Appeal dated 5.1.99 had clearly held that principles of unjust enrichment will not apply in as much as shells and slides were captively consumed in the manufacture of Cigarettes relying upon the decision in the case of Godrej Boycee Manufacturing Ltd. vs. CCE Bombay 1998 (29) RLT 11 (CEGAT) and in the case of Electronic Research Ltd. Vs. CCE Madras 1998 (101) ELT 97 (Tri); that this finding of the Commissioner (Appeals) was not challenged by the Department in appeal and, therefore, the Commissioner (Appeals) can not now, under the impugned Order, hold that the principles of unjust enrichment will apply in view of the Supreme Court decision in the case of Solar Pesticides (supra).