1. Both these appeals arise from common facts involving same question of law and hence they are taken up together for disposal as per law.
2. The appellants filed refund claim for duty paid by M/s. Hindustan Petroleum in respect of supplies of NGL at concessional rate of duty for using manufacture of fertilizer. The appellants by their letter of refund claimed excess payment of duty paid by M/s. ONGC, who were the suppliers. The department issued a show cause notice in these refund applications in which it was stated that the appellants are engaged in manufacturing of Liquid Nitrogen/Liquid Ammonia and Urea falling under Chapter No. 28 & 31 of the Central Excise Tariff Act, 1985 and holding Central Excise Registration Certificate No. 0037-04-01-0027 for the manufacture and clearance of the said excisable products. It was stated that the appellants had filed a refund claim seeking excess payment of duty paid by M/s. ONGC. Hazira, Surat under Notification No. 75/84 dt.
1.3.84 as amended. NGL was being received by them under Chapter X procedure at concessional rate of duty of Rs. 5.50 per KL. They procured the same from M/s. Hindustan Petroleum, Surat for the manufacture of fertiliser through the media of steam and power.
However, it was alleged that the permission was later denied. This resulted in procurement of NGL at full rate of duty. The appellants filed refund claim for this excess amount of duty paid by M/s. ONGC in respect of clearances made by them. The show cause notice alleged that the duty had been paid by M/s. Hindustan Petroleum and as they did not pay the duty, hence they are not entitled to claim their refund. It was also stated that the claim had not been filed in required format and original papers were not forwarded. Hence, it was stated that they are not entitled to benefit of Notification No. 75/84.
3. The appellants by their reply admitted not having paid the duty by themselves. They also admitted that the duty paid by M/s. Hindustan Petroleum was not reimbursed by them as on that date. They stated that the supplies of inputs was done by ONGC through Hindustan Petroleum (an internal arrangement of ONGC from the point of view of sale and accounting). However, the burden of the same is to be suffered by them and hence their claim for refund of excess duty paid was in order.
According to the procedural arrangement, it could be verified that when the supplies were being effected to them at concessional rate against a CT-2 certificate issued to them by the Assistant Commissioner, the same were being routed by ONGC through Hindustan Petroleum to them. They also stated that the excess duty had to be paid on account of arbitrary stoppage of supplies of NGL to them at concessional rate by illegal directions given by the Supdt.-in-charge of ONGC to ONGC in excess of jurisdiction and without appreciating that he had no powers under the law to stop such supplies at concessional rate against CT-2 certificate so long as CT certificate was not rescinded and the powers for rescinding of CT-2 certificate vested only in Deputy Commissioner/Assistant Commissioner.
4. The Assistant Commissoner by his Order-in-Original held that the duty has been paid by the ONGC and not by them. He has relied on the judgment of Gauhati High Court in the case of Union of India v. Silcher Electric Co. as reported in 1977 ELT. (J. 157), wherein an identical issue, the Court had reached the conclusion that a person who was not a manufacturer or producer and who had not paid the excise duty directly is in no position to claim refund of excise duty. He has also held that an L-6 holder cannot claim refund of duty paid by L-4 holder and hence on the basis of this judgment and the reasoning adopted, he rejected their claim. The Commissioner (Appeals) in the impugned order while confirming the said finding also held that in terms of Sub-section (2) of Section 11B the Assistant Commissioner may order payment of refund to the applicant if such amount is estable to the duty of excise borne by the buyer if he has not passed on the incidence of duty to any other person. He has held that the in view of the statutory requirement the refund is admissible to the manufacturer if he had not passed on the incidence of duty to any other person and to the buyer if the duty of excise is borne by him. He has held that the appellants in this case are covered by proviso (e) to Section 11B(2). In other words, the appellants are eligible for the claim, If It is established that the duty of excise is borne by him and had not been passed on. He has noted from the records before him that the duty had been paid by the ONGC, the supplier of NGL through HPCL. At no stage the appellants bothered to establish or produce proof that the duty paid by the HPCL were reimbursed and was borne by them. In the absence of such evidence that the duty was borne by the appellant, no refund is due to them. In that view of the matter, he rejected both of their appeals.
5. We have heard Shri D.N. Mehta, the Learned Consultant for the appellants and Shri H.K. Jain, the Learned SDR for the Revenue.
6. The Learned Advocate submits that the Commissioner has taken a different view in the order than the grounds made out in the show cause notice and hence the order is vitiated on this ground itself. It is his submission that in terms of Section 11B 'any person' who is entitled to receive the refund can file a refund claim and therefore, the ground taken by the department that duty had not been paid by the appellants is not sustainable. He submits that even as per the latest judgment of Hon'ble Supreme Court rendered in the case of Mafatlal Industries Ltd. v. Union of India be made to the ultimate consumer. It is his contention that the fertilizer is sold on control price and that the duty deposited on their behalf by Hindustan Petroleum is not recovered from the actual users i.e. farmers. It is his submission that subsequent to the passing of the impugned order, they have now reimbursed the duty from HPCL and the HPCL has issued a letter in this regard confirming the receipt of the amount. It is his submission that the denial of the benefit of Notification passed by the Supdt. was also illegal which resulted in ONGC and on their behalf HPCL paying full rate of duty. This duty has since been cleared by them, therefore, the refund of excise duty is required to be made to the appellants, it is his contention that there is no dispute pertaining to time bar and only question on which the refund was referred was locus standi of the appellants. He points out that the Hon'ble Supreme Court in the case of Northern Plastics Ltd. v.Hindustan Photo Films Mfg. Co. Ltd. has brought out the meaning of 'any person' to mean third party, it is his submission that this clarification of the Supreme Court is sufficient to hold that the appellants being the person before the ultimate duty payers are entitled to file the refund claim. It is his submission that the term 'paid' used in Section 11B can be read as 'payable' also in terms of the judgment rendered by the Patna High Court as reported in 1997(32)ELT 521. He also submitted that the lower authorities have not dealt with the matter on merits. The authorities should have dealt with all the issues and not one issue alone. The Learned Advocate submits that the matter could be remanded for de novo consideration with a direction to the authorities to verify the payment made and consider both on merits and for a direction that excise duty could be refunded to them.
7. Opposing the prayer of the appellants, the Learned SDR submits that the appellants have no locus standi to file the refund claim as they had not deposited the duty and the duty had been paid by the Hindustan Petroleum on behalf of ONGC. It is his submission that in terms of Section 11B(2) also refund application has to be made by a person who has deposited and paid the duty. In this regard, he submits that the judgment rendered in the case of Hindustan Fertilizer Corporation Ltd. v. Collector of Central Excise apply to the facts of the case, as it was held in that case that the assessee was working under Chapter X procedure. Rule 196 provided for demand of duty from him on the goods not duly accounted for. If any duty has been levied on an industrial consumer under this rule, he would no doubt be entitled to claim refund thereof. It was observed that these considerations are not followed and where duty was paid unconditionally at the time of clearance by the manufacturer, namely IOC. The Learned DR also relied on the judgment referred to by the Commissioner in this order.
8. The Learned Advocate countering the arguments, submits that the citations relied are applicable to the facts of that case and moreover that judgment had been rendered prior to the amendment of the Section 11B of the Act. It is his submission that if the appellants' claim is not entertained than the refund provision itself would become redundant. He submits that the liability to pay duty to the Hindustan Petroleum by the appellants did exist and merely because they had not discharged the liability that by itself is no ground to reject their claim. It is his contention that as they have now cleared all the dues to Hindustan Petroleum, therefore, the refund application is required to be determined on merits.
9. We have carefully considered the submissions made by both the sides and have perused the impugned order and the citations referred to before us. As per the Section 11B(1) any person claiming refund of any duty of excise may make an application for refund of such duty to the Assistant Collector of Central Excise before the expiry of six months.
In this regard, the Section also defines the relevant date. Section 11B(B)(d)(e) and (f) reads as follows:- (b) in a case where a manufacturer is required to pay a sum, for a certain period, on the basis of the rate fixed by the Central Government by notification in the Official Gazette in full discharge of his liability for the duty leviable on his production of certain goods, if after the manufacturer has made the payment on the basis of such rate for any period but before the exphy of that period such rate is reduced, the date of such reduction; (e) in a case where duty of excise is paid provisionally under this Act or the rules made there under, the date of adjustment of duty after the final assessment thereof; 10. Sub-section 11B(2) states that "if on receipt of any such application, the Assistant Collector of Central Excise is satisfied that the whole or any part of duty of excise paid by the applicant should be refunded to him, he may make an order accordingly".
11. In this case the appellants claimed that Section 11B refers to 'any person' and this 'any person' need not necessarily be the person depositing the duty but it includes also the person who is entitled to receive the refund, if that view is not taken then the provision of refund would become redundant. In this case they had referred to the judgment rendered in the case of Mafatlal Industries Ltd. which has gone into the aspect of unjust enrichment. They have referred to the judgment of the Hon'ble Supreme Court rendered in the case of Northern Plastics Ltd. wherein it has been held that the word 'person aggrieved' as used in Sections 2(1B) and 129 of Customs Act which is parameteria to the Section 35 and 35B of the Central Excise Act, 1944 and do not really mean a man who is disappointed of a benefit which he might have received if some other order ad been made. A 'person aggrieved' must be a man who has suffered a legal grievance, a man against whom a decision has been pronounced which has wrongfully deprived him of something, or wrongfully affected his title to something. The Learned Advocate submits that the Learned Commissioner in the impugned order has held that the appellants have not produced evidence to substantiate their claim that the duty had been paid by them and that their refund application is sustainable. The Learned Advocate pointed out that the appellants have since reimbursed the entire duty amount to Hindustan Petroleum who had paid the duty on behalf of ONGC, therefore, their refund is sustainable and their claim should not be rejected on the ground taken by the Revenue. He pointed out that the Commissioner had taken a different ground alleged in the show cause notice.
12. On a careful consideration of these pleas, I am of the considered opinion that the matter be remanded for do novo consideration for the reasons that the Commissioner has proceeded on a different footing than the one made out in the show cause notice. Further the aspect pertaining to the appellants having locus standi is required to be adjudicated in the light of the Hon'ble Supreme Courts' judgment rendered in the case of Northern Plastics Ltd., which deals with the term 'person aggrieved' as appearing in Sections 2(1B) and 129 which is parameteria to the Section 35 and 35B of the Act. In this present case also, in Section 11B the word 'any person' is used and there is no reference to manufacturers' depositing the duty alone. However, the point which has also to be noted for consideration is as to whether the duty reimbursement by the appellants to Hindustan Petroleum after a lapse of 'relevant date' as defined in Section 11B would still make the refund claim within the ambit of 6 months. This aspect has not been examined, as the lower authorities have proceeded solely on the basis of the fact that the appellants have no locus standi in the matter. The Hon'ble Suprme Court in the case of Mafatlal Industries Ltd. has looked into the aspect of unjust enrichment and in this regard a detailed judgment has been given wherein the aspect of unjust enrichment has been discussed in great length. As most of the points raised by the appellants have not been gone into by the Revenue, it is but proper that the issue is kept open without any finding given by us at this stage on the aspect pertaining the locus standi of the appellants to file a refund application. The fact remains in this particular case that the duty has been paid on behalf of the appellants inasmuch as the appellants had received the inputs without concessional rate. The duty had been paid on their behalf at a higher rate and later the department appears to have granted the benefit. All these questions are required to be gone into by the lower authorities with regard to the admissibility of claim by the appellants as ultimate user of the inputs and the duty having been paid by them at higher rate. The entire aspect is required to be looked into in the light of judgments referred to. As the Commissioner has proceeded on a different footing, than the one raised by the department in the show cause notice, it is but proper that the matter is remanded to the lower authorities for de novo consideration to consider the pleas raised by the appellants on all aspects of the matter and pass a considered judgment after hearing them. Thus, both the appeals are remanded to the original authorities for de novo consideration.
13. With due respects to Hon'ble Member (Judicial), my views and orders in the matter are as under.
15. That the Central Excise duty due was paid by the manufacturers of the item namely, M/s. O.N.G.C. in respect of the goods for which they were L-4 licence holders.
16. That M/s. Hindustan Petroleum were merely distributing agency for M/s. O.N.G.C.17. That the appellants were L-6 licence holders but they did not receive the goods in question under CT-2 certificate but after clearance of the goods by the manufacturers on full payment of duty.
18. That the appellants had not paid the amount in question at the time of clearance or receipt of the goods.
19. In the normal course, since it is the O.N.G.C. the manufacturers, had paid the duty, it was open to them to have claimed the refund, if any considered due, within the time limit prescribed in Section 11B but they have not done so.
20. The appellants who are merely industrial user of the item have, on the other hand, filed the refund claim on the ground that the burden having been ultimately passed on to them, they are the affected person entitled to claim refund. The Learned Counsel has argued in this connection that Section 11B does not use the word 'manufacturer' or producer' but the word 'any person' and 'any person' would include a consumer who ultimately bears the burden.
21. The whole issue, therefore, revolves round the interpretation of the words 'any person' used in Section 11B and consequentially, on determination as to whether the appellants had any locus standi in the matter and could be considered as a person entitled to claim refund.
22. In this connection I observe that the words 'any person' used in Section 11B cannot be read in isolation but are required to be viewed with reference to the context in which they have been used.
23. It is a well established principle that an Act has to be read as a whole and in particular, all the related provisions must be viewed in a manner which is consistent with the principles of interpretation of the Law and the intention of the legislature as may be apparent from those provisions.
24. Hence, in my opinion, the words 'any person' have to be read in the context of the provisions of Section 2, Section 6, Rules 9, 49 and 174.
and other related provisions (which will be referred to as we proceed).
25. A reading of these provisions together shows that Section 2 covers not only manufacturers/producers but also brokers, commission agents and wholesale dealers; Section 6 extends the ambit of excise control over these persons; And Rule 174 explicitly mentions 'manufacturer', 'trader' or 'person(s)' including curers, brokers, commission agents and wholesale dealers who purchase such products from persons obtaining excisable goods for special industrial purposes under Rule 192 and all holders of private warehouses.
26. Therefore, Section 11B must be taken to refer to mean any of the above persons. The problem, however, does not end here because the person must also be one who has been charged with the responsibility or liability to pay duty to the Government.
27. It would be seen from a reading of the above provisions along with the provisions of Chapter III, V, VA, VII, VIIA, VIII & X that primarily, the responsibility to pay duty had been placed on the manufacturer or the producer of goods and he is required to discharge it on removal of the goods from the factory premises or an approved place of storage (i.e. at the time of clearance) except where the movement of the goods without payment of duty is permitted under the provisions and along with it, the liability to pay is shifted on to a warehouse licencee or to an industrial user for specified purposes.
28. The provisions of Rule 9 read with Rule 49 lay down the time and manner of payment of duty required to be paid on removal of the goods and Chapter VILA refers to removal of excisable goods on determination of duty by producers, manufacturers or private warehouse licences and at the same time, to the special provisions under which the duty liability is required to be discharged in accordance with the provisions contained in Section C.I. E. III or E. IX of Chapter V or the provisions of Chapter V-A apply. Similarly, under Chapter X, which has been referred to by both the sides, remission of duty on goods used for special industrial purposes is allowed subject to compliance with the provisions of that Chapter, It would be seen there from that the duty liability gets shifted to a L-6 licencee only in respect of the goods received under the provisions of that Chapter and not otherwise; And, furthermore, the provisions of Chapter X are basically concerned with the situation requiring remission of duty only.
29. The sum and substance of all these provisions is that the responsibility to pay duty directly to the Government is on the producer or manufaturer unless the liability is shifted to another person under one of the various provisions in the Act. Once it is so shifted then naturally the refund, if any due, could be claimed (and correspondingly, the demand, if any, would have to be honoured) by such a person to whom the liability has been shifted and not otherwise.
30. Therefore, in the normal course, the responsibility for payment of duty and consequentially for either claiming refund or honouring demand has been put on the person who has paid the duty to the Government in accordance with the above provisions and not to any or every person on whom the burden may ultimately fall.
31. It is well known that from the point of view of economics, (particularly public finance) as well as from a legal point of view, the central excise is in the nature of indirect taxation.
32. The burden to pay duty to the Government initially lies on the producer or manufacturer of the goods unless shifted to specified persons as seen above and it is these persons alone who have a locus standi in the matter and not anyone or everyone who claims to be an ultimate consumer or bearer of the burden.
33. In fact, this is the most significant distinction between direct taxes such as the Income Tax and the indirect taxes such as the Central Excises, Customs and Sales Tax etc. It is this fundamental principle which cannot be ignored or overlooked as it has been built in and translated in the form of legal provisions in our Act by virtue of various sections and rules referred to above and this picture clearly emerges from a reading of the Act as a whole.
34. In the present case, once the person primarily responsible under the Act to pay the duty namely, the manufacturer or producer of the goods (holder of L-4 licence for this purpose) had discharged that responsibility by paying the duty to the Government at the time of clearance, then further action, if any would lie within his ambit and it is he and he alone who can either claim refund (or can be required to honour the demand, if any) and not any other person.
35. The words 'any person' used in Section 11B have to be viewed in this context as any of the specified persons and not just anybody or everybody. This also becomes clear from the fact that ultimately it is all the 80 crore persons, (virtually, the entire population of the country) who have to in ultimate analysis, bear the burden of such indirect taxation as central excise and it is apparently not the intention of the legislature to allow just anyone of them to apply for the refund (or to allow the Department to raise demand from just anyone of the crores of persons in case of short levy); And, the Department's jurisdiction has been limited to the persons brought under its control by the aforesaid provisions.
36. Let us look at the problem from another angle -- that of time bar.
Once the producer/manufacturer has paid the duty (rightly or wrongly), the time bar will start running in terms of Section 11B and the relevant date will have to be calculated with reference to the provisions of Section 11B. Therefore, the manufacturer of the goods and the person who paid the duty having admittedly not claimed refund thereof within the normal period of limitation prescribed under Section 11B any other claim from any other person cannot be entertained because if it is so done, it will amount to circumvention of provisions of time bar built in Section 11B. In fact, entertaining the request of the appellants would therefore, amount to permitting persons to defeat the provisions of time bar.
37. It is also noticed that admittedly in this case, the amount in question was not paid at all by the appellants at the relevant time.
Any subsequent payment to a third party for whatever reasons (under whatever private arragements) does not alter the fact that it is the O.N.G.C. who has paid the duty to the Government and not the appellants. That M/s. O.N.G.C. were subsequently reimbursed directly or indirectly through their dealers M/s. Hindustan Petroleum for whatever commercial or other reasons is none of our concern. These are purely private arrangements with which the central excise authorities are not concerned and need not and cannot look into.
38. In fact, such transference of money from wholesale dealer/distributor or industrial unit to manufacturer and from retail dealers to wholesale dealers/commission agents and from the ultimate buyer or consumer to the shopkeeper is a part of the indirect taxation system but the jurisdiction of central excise authorities is confined to the producer manufacturer and only such other persons as are specifically covered by the Act and in the later case, only for specified purposes to the specified extent in the given circumstances and not otherwise.
39. A question has been raised about Supdt.'s action; whether the Supdt. was authorised or not authorised to allow or disallow CT-2 certificate is, however, not germane to the issue before us and it was for the concerned persons to have challenged the orders of the Supdt., if they were aggrieved, by following the prescribed procedure within the prescribed time; But, it is not open to raise that issue in the present proceedings.
40. Insofar as the case law which has been cited by either side is concerned, I find that the authorities below have rightly relied upon the judgment of Hon'ble Gauhati High Court in the case of Union of India and Anr. v. Silchar Electric Supply Co. Ltd. reported in 1977 ELT (J157) in which it has been clearly held by the Hon'ble Court that "the grant of a licence L-6 No. 1./SIL/DGVL/63 merely enables the plaintiff to buy the furnace oil free form excise duty. If, however, the plaintiff had paid excise duty despite the grant of such license, his claim for refund may possibly be against the defendant No. 3 or the recipient of the duty from the plaintiff, but cannot, in my opinion, be against the Union of India." In other words, if the L-4 licence holder has paid the excise duty despite the L-6 licence, the L-6 licence holder can claim L-4 licence holder only and cannot file a claim against the Excise Department. The following words are very significant in this regard:-- No doubt the excise duty which has been levied on the manufacturer of the producer, may be eventually passed on to the ultimate consumer or buyer, but so far as the statute is concerned, the liability for paying the tax is on the manufacturer or producer, as the case may be, and the right to collect the same by the Union of India is only against such manufacturer or producer. In my opinion, therefore, (the plaintiff, who was not a manufacturer or a producer and who was, therefore, not required to pay any excise duty to the Union of India directly is in no position to claim refund from the Union of India because the plaintiff had made no payment to the Union of India.Hindustan Fertilizer Corporation Ltd. v. Collector of Central Excise, Calcutta specifically deals with Chapter X cases and in similar situation, clearly indicates that the L-6 licence holder had no locus standi in such cases where L-4 Licence holder has already paid the duty. Actually, in this case, the appellants purchased furnace oil from the refinery of the Indian Oil Corporation during the relevant period. The excise duty at the normal rate was paid by the manufacturers, namely I.O.C. The procedure laid down in Chapter X was not followed; And, it was held that the appellants, who were buyers of the excisable goods from the I.O.C. (the manufacturers) had no locus standi to claim refund of duty paid by I.O.C. No doubt excise duty, being a tax on consumption, would be borne by the ultimate user and, therefore, any relief in excise duty is also intended to benefit the ultimate consumer, but it does not mean that the ultimate consumer can deal directly with the excise authorities. Although under Chapter X, the industrial user has to deal directly with the central excise authorities for certain purposes inasmuch as he has to make an application to the Collector and obtain a L-6 licence under Rule 192, and the eligibility for the concession under notification No. 195/76-CE depends upon the action to be taken by him, even so, since the duty burden is discharged by the manufacturer, it is he who is liable to make a short levy of duty if discovered subsequently, and it is equally he who is eligible to receive refund of duty from the excise authorities. There can be a situation where the duty liability is transferred to a person other than the manufacturer. In that case, the liability to pay extra duty and the right to receive refunds may be passed on. But, where the duty was paid at the time of clearance by the manufacturer was not applicable.
42. The judgments cited by the learned Counsel are distinguishable both on facts and in law and are not applicable in the present case.
43. This is clear from the fact that here, we are not concerned with the interpretation of the words 'already paid', 'contracted to be paid' or 'ought to have been paid' becavise that is not the issue before us and the judgment of Hon'ble Patna High Court in the case of Tata Yodogawa Ltd. and Anr. v. Union of India and Anr. is not relevant.Northern Plastics Ltd. v. Hindustan Photo Films Mfg. Co. Ltd. Court has dealt with the provisions relating to appeal, review and revision and has interpreted the 'person aggrieved' in the context of the provisions of Sections 128 & 129 of the Customs Act and corresponding Sections 35 and 35B of the Central Excise Act. The case before us relates to payment of assessed duty and the question of refund thereof and we are not concerned here with the provisions relating to the appeal review or revision. There is no doubt or dispute that the impugned order, having been passed against the appellants, the appellants were entitled to file an appeal before this Tribunal as persons aggrieved there from. But, the issues involved in the present appeal being different, this judgment of Hon'ble Supreme Court does not advance the cause of the appellants; And, it is the judgment of Hon'ble Guwahati High Court in the case of Silchar Electric Supply Company Ltd. (supra) and the Tribunal's order in the case of Hindustan Fertilizer Corporation Ltd. cited above which are relevant and applicable to the facts of the present case.
45. In view of the above discussion, I hold that the appellants who have not paid any amount to the Union of India have no right to claim any refund from Union of India. Since they have no locus standi in the matter, the authorities below were justified in rejecting their claim.
The impugned orders are, therefore, upheld and the appeal is dismissed.
46. In view of the difference of opinion between Hon'ble Member (Judicial) and the Vice-President, the matter is submitted to Hon'ble President for reference to a Third Member on the following point:- Whether in the facts and circumstances of the case, the appellants had no locus standi and their claim was required to be dismissed as such and the orders of the authorities below were required to be upheld or the impugned orders were required to be set aside and the matter remanded for reconsideration.
47. The facts leading to the question referred to me have been brought out by the Member (Judicial) in paragraph 12--4 of his order.
The Assistant Collector in rejecting the claim has relied upon the judgment of Guwahati High Court in the case of UOI v. Silchar Electric Supply Co. (supra). The Hon'ble Vice-President, in his judgment has also laid stress thereupon. The refund in that case was claimed under Rule 11B of Central Excise Rules, 1944, which was the forerunner of the present Section 11B of CESA. 1944 and read as follows: No refund of duties or charges erroneously paid, unless claimed within three months. No duties or charges which have been paid or have been adjusted in an account-current maintained with the Collector under Rule 9, and of which repayment wholly or in part is claimed in consequence of the same having been paid through inadvertence, error or misconstruction, shall be refunded unless the claimant makes an application for such refund under his signature and of such payment or adjustment, as the case may be.
48. The Hon'ble High Court held that the claimant could be only the one, who had paid the duty and that the respondent company could not claim the refund.
49. In their judgment in the case of Oswal Oil & Soap Industries, the Punjab & Haryana High Court also gave a similar ruling . The Court held that from the language of Sub-section (2) of Section 11B, only that person, who had paid the duty could apply for refund. Any other person, who had not actually paid the excise duty, had no locus standi, to apply for refund.
50. It must, however, be kept in mind that the claim for refund arose in 1984.
51. The Tribunal in their judgment in the case of CCE, Allahabad v.G.E.C. reported in 1987 (31) E.L.T. 108 also held that only that person could claim refund, who had paid the duty. In this judgment, the Tribunal had placed a narrow interpretation on the term "any person" appearing in the Section. The claim in this case arose in 1979.
52. In the Judgment of the Tribunal in the case of Cyma Industries reported in 1997 (96) E.L.T. 309 (Tribunal) also it was held that a buyer had no locus standi to claim refund from the Government. In this judgment, the term "any person" is interpreted as the person, who had paid duty and not any person in word at large. This judgment was pointed out to the Ld. advocate. Vide written submission dated 19.2.98, the ld. advocate made a categorical claim that the case pertained to the period prior to the amendment of Section 11B in 1991.
53. All these judgments relate to the situation occuring before the amendment of Section 11B in 1991. At that time, the scope of the wording "any person" had to be necessarily limited to the person on whom the burden to pay duty rested and who had discharged that burden.
However, the amended Section 11B widened the scope of the term "any person". Sub-section (2) now reads as under: (2) If, on receipt of any such application, the Assistant Commissioner of Central Excise is satisfied that the whole or any part of the duty of excise paid by the applicant is refundable, he may make an order accordingly and the amount so determined shall be credited to the Fund: Provided that the amount of duty of excise as determined by the Assistant Commissioner of Central Excise under the foregoing provisions of this sub-section shall, instead of being credited to the Fund, be paid to the applicant, if such amount is relatable to-- (a) rebate of duty of excise on excisable goods exported out of India or on excisable materials used in the manufacture of goods which are exported out of India; (b) unspent advance deposits lying in balance in the applicant's account current maintained with the Commissioner of Central Excise; (c) refund of credit of duty paid on excisable goods used as inputs in accordance with the rules made, or any notification issued, under this Act; (d) duty of excise paid by the manufacturer, if he had not passed on the incidence of such duty to any other person; (e) the duty of excise borne by the buyer, if he had not passed on the incidence of such duty to any other person; (f) the duty of excise borne by any other such class of applicants as the Central Government may, by notification in the Official Gazette, specify: Provided further that no notification under Clause (f) of the first proviso shall be issued unless in the opinion of the Central Government the incidence of duty has not been passed on by the persons concerned to any other person' The amendment has the effect of widening the scope of the term "applicant" beyond the manufacturer/producer, on whom the primary responsibility to pay duty lay. It now includes the buyer. As such, the ratio of the judgment cited by the Hon'ble Vice-President as also the other judgments would not apply to a person seeking to claim refund subsequent to the amendment.
54. In fact, in the impugned order, the Collector has accepted this situation. In his order he observed "in other words, the appellants are eligible for the claim if it is established that the duties of excise is borne by him and has not been passed on". He has upheld the order of denial of refund only on account of the failure of the applicants to produce proof that the duty paid by the HPCL was reimbursed and was borne by them. The Id. Advocate, at the time of personal hearing, claimed that the evidence was available and could be placed before the appropriate authority.
55. In my opinion the present appellants had a locus standi to claim refund, I agree with the order of the Member (Judicial) that the matter be remanded to the original authority for reconsideration.
56. The papers may now be placed before the Bench which originally heard the matter.
57. In view of the majority opinion, the impugned order is set aside and the matter remanded to the original authority for reconsideration.