International Conveyors Ltd vs Commnr. Of Central Excise & Customs

2. In our opinion, this case hardly involves any legal issue but we feel more concerned about the hard luck of the appellant, a manufacturer of PVC Coal Conveyor Belting made from imported Nylon Yarn. We do not propose to go into the circumstances in which the litigation had started but we start from the point which gave rise to some confusion and as a result thereof the appellant was dragged to the present litigation.

4. In pursuance of the above order, the appellant filed a refund claim along with relevant documents, for Rs.17,35,119/-, the amount which was paid by way of duty under protest in respect of the nylon yarn which was imported by the appellant during the period commencing from February, 1987 to February, 1988.

6. After the aforestated order was passed by the High Court, the Assistant Collector of Central Excise issued a show cause notice dated 27.04.1994 calling upon the appellant to show cause as to why the application claiming refund should not be rejected on the ground of unjust enrichment as the amount of tax was alleged to have been recovered by the appellant from M/s. Coal India Ltd. and M/s. Singarani Collieries Co. Ltd., to whom the goods had been supplied by the appellant.

14. Upon hearing the concerned counsel and looking at the facts of the case, it is very clear that it is an admitted fact that the amount of duty paid by the appellant had never been passed over to the purchasers and the said fact has been duly recorded by the Deputy Collector, Central Excise and Customs, Aurangabad in his order dated 5th April, 1995. The said order has attained finality as nobody challenged the said order. An undertaking, though strictly not required to be given, was given by the appellant as demanded under the aforestated order dated 5th April, 1995 and ultimately the amount had been refunded to the appellant. In our opinion, there is no question of demanding the said amount again, especially when the facts which had been disputed by the Revenue before the Tribunal had already been admitted in the proceedings which had been initiated by the Deputy Collector, Central Excise and Customs, Aurangabad in his order dated 5th April, 1995. We are not in agreement with the findings arrived at by the Tribunal which are contrary to the facts recorded by the Deputy Collector, Central Excise and Customs, Aurangabad. Unfortunately, the said order has not been referred to at all by the Tribunal. Without disturbing the findings arrived at by the Deputy Collector, Central Excise and Customs, Aurangabad in his order dated 5th April, 1995, the Revenue could not have come to an altogether different conclusion on facts. In our opinion, due efforts were made to find out whether the amount of duty had been passed over to the purchasers, who are either government Companies or Corporations controlled by the Government. It has been clearly stated in the aforestated order dated 5th April, 1995 that even the purchasers had admitted the fact that the amount of duty paid by the appellant had not been passed over to the said purchasers or in other words, the said amount of duty had not been recovered from the said purchasers.

5. As the amount of refund had not been paid in pursuance of the refund claim made by the appellant, the appellant was constrained to file Writ Petition No.5185 of 1993 before the High Court of Bombay praying for a direction that the aforestated amount be refunded along with interest thereon to the appellant. The said petition was allowed and by virtue of an order dated 19th April, 1994, the High Court had directed the Revenue to take appropriate action for making payment of the refund of Rs.17.35 lacs within three months from the date of the order to the appellant.

13. The said order dated 31st March, 2004 was challenged by the appellant before the Tribunal and the Tribunal was pleased to dismiss the said appeal and the impugned order of dismissal dated 6th September, 2004 has been challenged by the appellant in this appeal.

16. For the aforesaid reasons, we quash and set aside the impugned order passed by the Tribunal dated 6th September, 2004. The appeal is allowed with costs. Looking at the hardship suffered by the appellant, in our opinion, it would be just and proper to award an amount of Rs.25,000/- as costs and the said amount shall be paid to the appellant within three months from the date of this order by the respondent authority.

……….......................................J .

(ANIL R. DAVE) ……...........................................J. (SHIVA KIRTI SINGH) New Delhi February 25 , 2014