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Gowri Hosiery Mills V/S CCE, Coimbatore

Company & Directors' Information:- J G HOSIERY PRIVATE LIMITED [Active] CIN = U18101TZ2001PTC009707

Company & Directors' Information:- C R MILLS COIMBATORE PRIVATE LIMITED [Active] CIN = U17111TZ2002PTC010317

Company & Directors' Information:- K D S HOSIERY PRIVATE LIMITED [Active] CIN = U18101PB2001FTC024327

Company & Directors' Information:- J M HOSIERY MILLS PRIVATE LIMITED [Active] CIN = U17299PB2000PTC023753

Company & Directors' Information:- R M H HOSIERY PRIVATE LIMITED [Active] CIN = U17125DL2007PTC167271

Company & Directors' Information:- P T M HOSIERY PVT LTD [Active] CIN = U52322WB1994PTC062394

Company & Directors' Information:- M G HOSIERY PRIVATE LIMITED [Active] CIN = U17124TZ2002PTC010195

Company & Directors' Information:- J J HOSIERY MILLS PRIVATE LIMITED [Active] CIN = U45203WB2000PTC091570

Company & Directors' Information:- O K HOSIERY MILLS PVT LTD [Active] CIN = U99999DL1980PTC010979

Company & Directors' Information:- D D HOSIERY PVT LTD [Active] CIN = U18101WB1973PTC028694

Company & Directors' Information:- M. B. HOSIERY PRIVATE LIMITED [Active] CIN = U18101WB2008PTC125110

Company & Directors' Information:- R R HOSIERY PRIVATE LIMITED [Active] CIN = U18101MH1984PTC034394

Company & Directors' Information:- K K HOSIERY PRIVATE LIMITED [Active] CIN = U18204MH2014PTC251777

Company & Directors' Information:- B B HOSIERY PRIVATE LIMITED [Strike Off] CIN = U74999MH2015PTC267158

Company & Directors' Information:- M C S HOSIERY PRIVATE LIMITED [Strike Off] CIN = U51311WB2001PTC093781

Company & Directors' Information:- THE INDIA HOSIERY MILLS LTD [Strike Off] CIN = U17121WB1949PLC018383

Company & Directors' Information:- S P HOSIERY PVT LTD [Strike Off] CIN = U51311PB1985PTC006113

    Appeal No. E/41634/2016 (Arising out of Order-in-Appeal No. 105/2016 dated 4.5.2016 passed by the Commissioner of Central Excise (Appeals - I), Coimbatore) and Final Order No. 40314/2017

    Decided On, 20 February 2017

    At, Customs Excise Service Tax Appellate Tribunal South Zonal Bench At Chennai

    By, MEMBER

    For Petitioner: J. Shankar Raman, Advocate And For Respondents: A. Cletus, Addl. Commissioner (AR)

Judgment Text

1. The grievance of the appellant is that for a short duration, there was levy of excise duty on hosiery goods and such levy was on MRP basis. Entire clearances were made to the consignment agent issuing invoices to that agent under Section 4A of the Central Excise Act, 1944 (hereinafter referred to as the Act) disclosing the duty amount payable on the clearance made. Such disclosure was made for the convenience of calculation and discharge of duty without charging any duty to the consignment agent. The consignment agent was ultimately selling the goods to retailers and retailers were selling the goods to the buyer. The consignment agent was not authorized to collect central excise duty by virtue of provisions contained in section 4A of the above said Act.

2. Revenue alleged that excise duty element having been disclosed in the invoices issued by the appellant such duty element was realized by it and was unjustly enriched at the cost of the exchequer. But that was not the case and Revenue's allegation was baseless in absence of any cogent and credible evidence led in that regard. The hosiery goods was subjected to MRP clearance and the MRP was mentioned on the package of the hosiery goods. The consignment agents was only authorized to sell the goods within the MRP declared on the package. The duty appeared in the invoice issued by the appellant to the consignment was neither realized by the consignment agent nor by the appellant since MRP fixed goods were cleared.

3. Learned adjudicating authority although granted refund being satisfied on the materials adduced before him, he transferred the refund amount to the Consumer Welfare Fund under misconception of fact and law. Learned Commissioner (Appeals) also agreed with him for which Appellant has been aggrieved and has come in appeal against his decision.

4. In order to defend the allegation of unjust enrichment, the appellant relied on page 12 of the appeal folder tabulating all the MRP clearances made during the relevant period, depicting invoice number and dates through which the goods were cleared to the consignment agent and the corresponding invoices issued by the consignment agent to the retailers charging the price below MRP quoted on the package. Such facts and figures are verifiable from different invoices and sales bill which were subject matter of scrutiny by the adjudicating authority in para 10 of his order. But the Authority below reached to the conclusion that the refund has to meet the test of unjust enrichment.

5. Revenue on the other hand supports the adjudication on the ground that when the appellant disclosed central excise duty on the invoices, law requires Revenue to presume that appellant was unjustly enriched unless the contrary is proved and burden of proof lies on the appellant to establish that it was not been unjustly enriched. The facts and figures appearing in page 12 of the appeal folder were not before the authority below with evidence. Appellant simply placed some papers for which it cannot be said to have discharged its burden of proof. Therefore appellant's claim in page 12 of the appeal folder needs to be examined by the adjudicating authority since the transactions are only 24 as appearing in pages 12 to 14 of the appeal folder.

6. Heard both sides and perused to record.

7. Appellant has clearly depicted respective invoices through which the goods were sent to consignment agent and the corresponding bills issued by the consignment agent disclosing the price in respect of sale of those goods. Appellant demonstrated that in no case the price quoted in invoice has exceeded the MRP charged by the consignment agent. To remove the doubt of the department that appellant was unjustly enriched by the duty element depicted on the invoices issued to consignment agent, the entries depicted in page 12 to 14 of the appeal folder may be examined by the learned Adjudicating Authority. Appellant shall satisfy whether any duty was realized separately by the consignment agent from the retailer and whether there was any flow back thereof to the appellant. So also the Authority has to examine whether any duty was realized by appellant from the co

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nsignment agent. 8. Appellant is entitled to reasonable opportunity of hearing to demonstrate to the authority as to its claim that it was not been unjustly enriched. Recording the evidence and pleadings of the appellant, the authority shall pass appropriate order. 9. In the result, appeal is remanded to the adjudicating authority with the above direction for re-adjudication of the matter to the above limited extent, by 30th June 2017.