Order Date – 24 July 2023

Parties: M/s. Sakthi Industrials Vs The Commissioner of Customs

Facts – 

• The Appellant, M/s. Sakthi Industrials, filed a refund claim of duty paid under protest on water filters based on OIA. The refund was partly rejected, and the balance amount sanctioned were ordered to be credited to the Consumer Welfare Fund on the ground that the said claim is hit by the principle of unjust enrichment.

Issue – 

• Whether the refund is hit by the bar of unjust enrichment?

Order – 

• The Tribunal observed that the appellant has collected excise duty by issuing invoice to their dealers and thereafter has issued credit notes as mark of returning the excise duty. However, it has to be borne in mind that the dealers have already passed on the said duty element to the consumers while selling the water filters to the consumers.
• There is no evidence that the appellant has returned the excise duty to the ultimate consumers. The Hon’ble Supreme Court in the case of M/s. Addison and Co. Ltd. had occasion to consider the very same point and held that by merely issuing credit notes subsequent to the clearance of goods, the assessee cannot be said to have passed the bar of unjust enrichment envisaged under Section 12B of the Central Excise Act, 1944.
• Following the same, it was held that the order passed by the authorities below is legal and proper and does not require any interference. The impugned order is sustained. The appeal is dismissed.

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