ORDER
G.R. Sharma, Member (T)
1. The issue involved in this appeal is whether the refund claim filed by the appellants has been rightly rejected or it should have been accepted.
2. The facts of the case are that the appellants filed a refund claim on the ground that the product i.e. Glass Wool mats was not dutiable. The appellants claimed benefit of exemption from Central Excise duty on their products from February, 1987 to September, 1987. However, in October, 1987, they were directed to pay full duty for the past clearance and also directed to take future clearances only on payment of duty. Therefore, the appellants filed a refund claim for Rs. 2,12,15,837.54 P which was rejected by the Assistant Collector on the ground that burden of duty was passed on to the customers and therefore, the appellants are not entitled to refund.
In appeal also, the learned Commissioner (Appeals) upheld the order of the Assistant Collector.
Arguing the appeal, Shri S.V. Arya, learned Counsel submits that the appellants had two sets of the price lists, that was in Form I and Form II. He submits that Form II price list was for supplies of goods under contract. He submits that in some cases, it was required to be declared that the prices were inclusive of excise duty. The learned Counsel submits that actually during the material period, the sales of the appellants were panic sales. The sales realisation was much below the cost of goods on manufacture. He submits that thus the burden of duty was not passed on to the customers inasmuch as, the sales realisation was much less than the cost of production. He submits that long back in July, 1991, they had furnished a Chartered Accountant Certificate communicating clearly that the cost of production was much higher. He submits that since the incidence of duty was not passed on to the customers and since in Part II price list, they had declared that the price was inclusive of Central Excise duty simply because the contract so required. He submits that terms of para 91 of the judgement of Apex Court in the case of Mafatlal Industries reported in [1997 (89) E.L.T. 247] is relevant to the facts of the present case. He submits that the burden of duty was not passed on to the customers, the refund claim has been wrongly rejected by the lower authorities and prays that the refund claim may be allowed.
Shri Mewa Singh, learned DR appearing for the respondent Commissioner, submits that during the relevant period, the invoices showed a composite price in respect of Part I price list. He submits that Central Excise duty being an indirect tax, is normally collected by the manufacturers from the customers. He submits that the gate passes issued during the material period indicated that duty was paid and since duty was paid, had notional meaning that incidence of duty was included in the price and since it was composite price, it was passed on to the customers. He submits that in respect of Part II price list, the averment of the assessee was that the prices were inclusive of Central Excise duty and thus he submits that the lower authorities have rightly rejected the refund claim as the duty incidence was passed on to the customers.
We have heard the rival submissions. We find that the main contention of the appellants is that the sales realisation was much less with the cost of manufacture and since the sales were in the nature of panic sales, therefore, there was no question of realisation of the Central Excise duty from the customers. The learned Counsel submits that in majority of the cases, there was no indication that the burden of duty was passed on. He submits that in respect of these cases, no benefit has been given nor the evidence produced that the burden of duty was not passed on, in view of the fact that cost of production was much higher than the sales realisation was not considered by the lower authorities. He submits that their case was covered by the decision of the Apex court in Para 91 of their judgment in the case of Mafatlal Industries reported in [1997 (89) E.L.T. 247].
On a careful consideration of the submissions, we find that it is a fit case for remand in view of the fact that various contentions including the judgement of the Apex Court in para 91 as indicated above, was not examined by the lower authorities. We therefore remand the matter to the jurisdictional Assistant Commissioner to examine the evidence in its entirety including the decision of the Apex Court in para 91 of their judgment and pass appropriate orders in accordance with law after extending the benefit of personal hearing to the appellants. The appeal is therefore, allowed by way of remand.