SHIVAGRICO IMPLEMENTS LTD. Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) HEARD both sides.

(2.) THE following question of law is referred to the Larger Bench "Whether bar of unjust enrichment will apply on refunds arising out of the clearances of goods from a unit working under Compounded Levy Scheme based on capacity of production" by the regular bench, after noticing two contrary decisions of the Tribunal in the case of Kothi Steel Ltd. v. CCE and in the case of K.B. Rolling Mills v. CCE

(3.) WE find that in the case of Kothi Steel Ltd. (supra), the Tribunal after taking into consideration the provisions of Section 3A of Central Excise Act held that bar of unjust enrichment is not applicable in the case of refund having arisen on account of adjustment under Section 3A(5) of Central Excise Act. Whereas in the case of K.B. Rolling Mills (supra), the Tribunal held that bar of unjust enrichment is applicable in the case refund claim arisen out of the Compounded Levy Scheme under Section 3A of Central Excise Act. The appellant raised the issue that they were not working under the Compounded Levy Scheme that they have paid duty under the Compounded Levy Scheme whereas the duty was paid in respect of the goods, which were produced and cleared prior to introduction of Compounded Levy Scheme. We are not going into this issue at this stage as the issue before us is whether bar of unjust enrichment will be applicable on refunds arisen out of the clearance of the goods from a unit working under the Compounded Levy Scheme, which is based on capacity of production. The Revenue relied upon the Hon'ble Supreme Court decision in the case of Sahakari Khand Udyog Mandal Ltd. v. CCE to submit that the bar of unjust enrichment is applicable in respect of all the refund claims. We find that Hon'ble Supreme Court in the case of Sahakari Khand Udyog Mandal Ltd. (supra) held as under : -