1. The Assistant Collector of Central Excise, Visakhapatnam I Division sanctioned a sum of Rs. 74,624.42 while considering two claims for refund of duty totalling Rs. 1,31,257.30 filed by the respondent M/s.
Andhra Asphalt (P) Ltd., in respect of excisable goods during the period 1-4-82 to 2-2-83 and 12-2-83 to 31-3-83. The rest of the claim was rejected as barred by limitation. The Collector of Central Excise (Appeals) considered an appeal (No. 154/84) from the respondent against the order disallowing part of the claim and an application (No. 152/84) under Section 35E(4) of the Central Excises and Salt Act, 1944 in respect of the amount actually sanctioned from the Assistant Collector of Central Excise. Visakhapatnam I Division. The Collector held that refund actually sanctioned was not impermissible keeping in view observations of various High Courts such as Allahabad, Madras, Bombay and Calcutta and a decision of the Supreme Court in the case of D.Cawasji and Company v. State af Mysore [1978 E.L.T. (J154) (SC)] details of which are set out in the order of the Collector (Appeals).
The case of the Department was that the amount of refund actually sanctioned had not not been passed on to the buyers from whom the respondent had collected the duty. The Collector (Appeals) held that in terms of the Supreme Court judgment in D. Cawasji and Co. case, "a. refund due to an assessee, who has paid the duty erroneously, cannot be denied merely on the ground that the assessee had collected it from his customers and has no intention to refund the duty collected to his customers consequent on a refund order issued by the Department".
Accordingly, he rejected the appeal preferred by the Assistant Collector under Section 35E (4) of the Act. This order as well as another order (dealt in Appeal No. 154/84) of the Collector in relation to rejection of part of the claim as barred by limitation have come up before the Tribunal. In this order, we deal with the order-in-appeal No. 9/84 dated 18-2-84 which confines itself to that part of the claim which was in fact sanctioned by the Assistant Collector by his order dated 28-6-83.
2. It has been indicated by the Supreme Court in the case of Miles India Limited v. Assistant Collector of Customs-1985 E.C.R. 289 (SC) that- "Customs Authorities, acting under the Act, were justified in disallowing the claim for refund as they were bound by the period of limitation provided therefor under Section 27 (1) of the Customs Act, 1962".
This was done by the Court even while according leave to withdraw the appeal to Miles India Limited against an order of this Tribuual (Delhi Bench). Though in the present case, we are considering a claim for refund of excise duty, the ratio decidendi in the Miles India case will apply as the provisions of Section 27 of the Customs Act, 1962 and Section 11B of the Central Excises and Salt Act, 1944 are framed more or less on similar lines. The converse of the decisions would be that where a refund is due under the Act, it could be allowed by the Departmental authorities or the Tribunal. The provisions of Section 11B are clear that when the refund claim is received within six months from the relevant date, refund is due; the Section does not refer to any other requirement such as the recipient of the amount of refund passing on the same to his customers.
3. The theory of unjust enrichment has been involved in considering claims coming up before the High Courts and/or the Supreme Court in exercise of their extra jurisdiction under Article 226/Article 32 of the Constitution. Not all the Courts are of the same view regarding unjust enrichment. Be it as it may, that it is a factor being kept in view by. the High Courts/Supreme Court in exercising writ jurisdiction does not lead to an inference that such a consideration has a place in dealing with a claim for refund of duty under Section 11B of the Central Excises and Salt Act, 1944. In this view of the matter, the Collector (Appeals) was clearly wrong in allowing himself to be influenced by the decisions cited before him which were all relating to decisions in exercise of writ jurisdiction by the High Courts/Supreme Court.
4. In these circumstances the appeal of the Department is dismissed and order of the Assistant Collector sanctioning the refund [as confirmed by the Collector (Appeals)] is restored though not for the reason relied on by the Collector. The amount of refund due may be paid to the respondent within three months from the date of this order.