FLEX INDUSTRIES Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) In this appeal filed by the appellants against the impugned order -in -appeal, the issue relates to the refund of the duty as claimed by the appellants.

(2.) I have heard both the sides. The facts as made out from the record are that the appellants issued some invoices for recovery of cylinder processing charges/art work, design and development charges for printed laminate/pouch, to their customers. They filed later on a refund claim on the plea that those invoices had been cancelled by them and they had issued credit notes to their customers in respect of the unclaimed amount. The Revenue has sought to deny the refund on the ground that they had passed on the incidence of duty to their customers. But in my view, this ground is not tenable. It is not a case where there had been clearance of the goods by the appellants and charging of duty by them along with the price from the customers. It is a case where the appellants issued the invoices to the customers for recovering the cylinder processing charges/art work, design and development charges. But later on issued credit notes for correction of their record as they thought of not claiming the charges from the customers. When they had not recovered the charges from the customers, they are certainly entitled to the refund of duty paid by them under the invoices which were cancelled by them. Even the original invoices were never passed on by them to the customers as they produced the same before the authorities. The ratio of law laid down in Sangam Processors (Bhilwara) and Anr. v. CCE -1994 (71) E.L.T. 989 holding that when duty had been charged at the time of clearance of the goods, subsequent credit notes would not change the position, is not attracted to the case of the appellants, in the light of the facts detailed above. In fact the incidence of duty had not been passed on by the appellants to their customers. The invoices issued by them were cancelled. Therefore, the appellants are entitled to the refund of the duty.

(3.) In the light of the above discussion, the impugned order is set aside. The appeal of the appellants is allowed with consequential relief, if any, permissible under the law.