COMMISSIONER OF CUSTOMS Vs. UNIFLEX INDUSTRIES (P) LTD.

JUDGEMENT

(1.) THE revenue has challenged the order of the Commissioner (Appeals) made on 28.2.05, setting aside the order of the Assistant Commissioner passed on 4.2.99, by which he had rejected the refund claim of the respondents for a sum of Rs. 46,800.73p.

(2.) THE Respondent was using the intermediate product known as lay flat tubing for captive consumption in the manufacture of poly bags, which were cleared at 'nil' rate under Notification No. 4/97 dated 1.3.97. The respondent was not availing exemption on lay flat tubing under Notification No. 67/95 -CE dated 16.3.95 for its captive consumption. Lay flat tubing were exempted from excise duty by Notification No. 5/98 -CE dated 2.6.98, which was not applicable to poly bags manufactured by a unit availing modvat on any products and as such poly bags became liable for payment of duty. The appellant had paid excise duty on the lay flat tubing from 2.6.98 to 13.6.98. However, in view of the exemption under Notification dated 2.6.98, a refund claim for Rs. 46,800.73p was filed by the respondent -assessee for the period from 2.6.98 to 13.6.98 during which it had paid the duty.

(3.) THERE is no dispute over the fact that the Respondent was not liable to pay the excise duty of the said amount during the period from 2.6.98 to 13.6.98 because of the exemption from duty in respect of lay flat tubing. The original authority held on the basis of a verification report dated 28.1.99 submitted by the Range Superintendent that no documentary evidence was adduced by the respondents to show that the burden of duty had not been passed on to the customers. The Asstt. Commissioner relied upon the presumption raised by Section 12B of the Central Excise Act, 1944 that, every person who has paid the Central Excise duty on the goods under the Act, unless contrary is proved by him, will be deemed to have passed on the full incidence of such duty to the buyers of such goods. In the present case, during the relevant period, the duty was paid by the respondents on poly bags in respect of which, lay flat tubing was captively consumed. The refund claim was in respect of duty which was paid on lay flat tubing during the said period when it was exempted from payment of excise duty in terms of Notification dated 2.6.98. In their refund claim dated 15.7.98, it was stated that the appellant was availing modvat credit on the products other than the poly bags. It was also stated that they were not availing exemption on lay flat tubing under the Notification dated 2.6.98 as amended for their captive use for manufacturing poly bags.