ORDER
M.P. Bohra, Member (J)
1. Heard Shri A. Raha, learned S.D.R. for the appellant Commissioner and Shri J.P. Khaitan, learned Senior Advocate along with Smt. Sanyukta Gupta for the respondent company.
2. Shri Raha, learned S.D.R. for the Revenue submits that in the present cases, the value of the goods which are removed from the factory to be sold at different depots, is determined at the time of removal of the goods from the factory. Therefore, there is no scope for re-determination of the value on the basis of the depot price at a subsequent date. Therefore, he submits that any refund claim on the basis of the so-called depot-sale, is irregular and not admissible. He, further, submits that the refund claims were incomplete, as the same were not accompanied by the relevant documents/or other evidences. Therefore, he submits that the appeals may be allowed, and the refund claims be rejected.
3. Shri J.P. Khaitan, learned Senior Advocate for the respondent company submits that in the present cases, the goods were cleared from the depots. He, therefore, submits that the value is to be calculated from the depots where-from the goods are sold and the difference in duty being short paid, is recoverable from the respondent company; and if it is excess, then the refund ought to be made to the respondent company. In the present cases, the respondents paid the excess duty when the goods were cleared from the factory, having been sold at lesser value from the depots. Therefore, the excess duty paid by the respondents has to be refunded to them. Hence, he contends that there is no infirmity in the Order of the Commissioner (Appeals), and also prays that by upholding the Order of the Commissioner (Appeals), the appeals filed by the Revenue may be dismissed.
4. I find that the Commissioner (Appeals) has observed in his Order dated 24-6-04 as under : –
(c) Going into the merit of the case I observe that the lower authority’s decision is biased and lopsided. When difference of duty short paid at the time of removal from the factory was determined and paid as a result of increase in price at the depots, the department accepted it without any murmur, but in a situation when excess payment of duty occurred owing to decrease in market value at depot, the lower authority betrayed irrational reservations in sanctioning the refund claim holding that there is no scope for re-determination of assessable value on subsequent dates. This view of the lower authority is devoid of reasons and contrary to legal provisions under Rule 7 of the valuation Rule 2000. The Rule 7 provides that under the circumstances of the case the normal transactional value of any consignment may often have to be ascertained from the depot price prevailed even before its clearance from the factory. Only requirement under the law is to ascertain the value of depot sale at the time of ex-factory clearance, and if it is impossible, the value at the time nearest to the time of ex-factory removal. Accepting the payment of short paid duty by the appellants the department has tacitly accepted the impossibility of ascertaining the normal transaction value only at the time of ex-factory clearance.
(d) As for unjust enrichment, alleged in the show cause notice and observed by the lower authority, I do not find any likelihood of unjust enrichment being an impediment against the claim for refund. I observe that under the covering letter GISCL/CE/02-03/4454 dated 28-2-03, the appellants submitted all the relevant documents including depot invoices which are indicative of the price at depot sale. Duty being ad valorem is proportionately reduced with the fall of price at the depot. As a result the appellants have to bear the burden of excess duty paid on the ex-factory value of the goods that t is higher than the actual transaction value.
I also find that the Order passed by the Commissioner (Appeals) is elaborate and reasoned. It is based on legal provisions of Rule 7 of Central Excise (Determination of Price of Excisable Goods) Rules, 2000. In the present cases, the Department has realised the duty from the respondents herein, where the duty was short paid by them, but refused to pay the refund to them, when they paid duty in excess. In the circumstances, I do not find any infirmity in the Order of the Commissioner (Appeals). The appeals deserve to be dismissed. Consequently, I dismiss the appeals filed by the Revenue.
Pronounced in the open court.