MODIPON FIBRES LTD. Vs. COMMISSIONER OF CUSTOMS, NCH

JUDGEMENT

(1.) AFTER hearing both sides for some time on the application for waiver of pre -deposit of Rs. 19,86,208, we found that it is possible to decide the appeal Page 242 itself at this stage; hence after waiving pre -deposit, we proceed to take up the appeal for final disposal with the consent of both sides.

(2.) VIDE the impugned order, the commissioner (appeals) has set aside the order of the asstt. commissioner by which refund of the amount above mentioned was sanctioned to the importers/respondents, and allowed the appeal of the revenue, holding that the bar of unjust enrichment is attracted even in the case of import of capital goods. The appellants submit that vide order dated 24th February, 1998, the asstt. commissioner sanctioned the claim but the amount was directed to be credited to the consumer welfare fund as there was no documentary evidence of non passing of the incidence of duty to any other person. The importers' appeal was allowed by the commissioner (A) by way of remand, as the importers had submitted a chartered accountant certificate to the effect that the amount was not included in the cost price of the manufactured goods; fresh adjudication order was passed sanctioning the refund after being satisfied that the duty burden was not passed on by the importers to their customers and the revenue's appeal against the sanction of refund was allowed by the impugned order. We do not see substance in the appellant's contention that the bar of unjust enrichment is not attracted in this case as the Supreme Court has held in the case of Sahakari Khand Udyog Mandal Ltd. v. CCE that "irrespective of applicability of Section 11B of Central Excise Act 1944, doctrine of unjust enrichment can be invoked to deny benefit to which a person is not otherwise entitled - Section 11B of the Act or similar provision merely gives legislative recognition to this doctrine. That, however, does not mean that in the absence of statutory provision, a person can claim or retain undue benefit. Before claiming a relief of refund, it is necessary for the petitioner/appellant to show that he has paid the amount for which relief is sought, he has not passed on burden on consumers and if such relief not granted, he would suffer loss". In the light of the above, we hold that the importers are required to satisfy the lower authorities that they have not passed on the duty burden to their customers. The presumption that the burden of duty has been so passed on is a rebuttable one and the importers have tried to rebut the presumption by placing on record the chartered accountant certificate that the amount of duty paid by them as a result of inclusion of interest on advances in the assessable value of goods manufactured by them was not included in the cost price of manufactured goods and the said amount did not influence the price of the goods produced and sold by them. The commissioner (appeals) has not considered the certificate. We, therefore, set aside the impugned order and remand the case for fresh decision after consideration of the chartered accountant certificate and any other material that may be placed on record by the importers to substantiate their claim of non passing Page 243 of duty burden to customers, to the commissioner (A) who shall pass fresh orders after extending a reasonable opportunity of hearing to the importers.

(3.) THE appeal is thus allowed by way of remand.