L. Rath, J.
1. An application made on 14.3.1982 for refund of excess duty paid having remained undisposed of, the petitioners have come before this Court seeking redress. The facts leading to the writ petition are that the petitioner No. 1, a manufacturer of glass-wares, filed six classification lists effective from May 1978 to April 1979 which lists were purported to be accepted by the order of the Assistant Collector dated 28.8.1980 (Annexure-5). By virtue of the acceptance of the classification lists the petitioner No. 1's liability to pay excise duty was accepted at 20% instead of 35% which was ordinarily payable since the Assistant Collector accepted the petitioner's plea of having adopted the manufacturing process of manually operated press having tank furnaces (hereinafter referred to as 'the manual process'). Such reduced tariff was payable in accordance with the Notification No. 329/77 of the Government of India in the Ministry of Finance, Department of Revenue, dated 26.11.1977 by which the manufacturers of the manual process were required to pay ad valorem duty at 18% as subsequently modified by Notification No. 25/79-C.E., dated 1.3.1979 increasing the duty to 20%. The petitioner No. 1 having paid duty at the enhanced rate of 35% in the meantime, refund applications were made by it claiming refund of a total sum of Rs. 30,16,981.45. The Assistant Collector by his order dated 14.4.1981 (Annexure 7-B) rejected the claim of refund being of the view that such refund cannot be directed as it would amount to unjust enrichment of the petitioner No. 1. An appeal was carried to the Appellate Collector of Central Excise, Calcutta, which was disposed of on 12.2.1982 (Annexure 7-C) in favour of the petitioner No. 1 directing the refund to be made. A fresh application for refund was filed on 14.3.1982 (Annexure-8) but no refund having been made, the petitioner No. 1 and one of its shareholders and Director, the petitioner No. 2, have filed the present petition before this Court. In spite of the service of notices having been sufficient, no counter affidavit was filed by the opposite parties. This case was heard in part on 6.2.1991 on which date it was adjourned to today. A counter affidavit has been sought to be filed by the opposite parties today in Court without obtaining the necessary permission of the Court as is required under the Rules of this Court. Though the counter affidavit is grossly belated and is ordinarily not to be accepted, yet we have thought it better to accept the same sine it purports to bring on record certain facts relevant for disposal of the case. It has been stated therein that after the notification granting exemption to manufacturers by manual process from the usual tariff and permitting them to pay a lower tariff at 18%, the petitioner No. 1 had submitted classification lists claiming such exemption but those had been rejected by the Assistant Collector by his order dated 12.5.1978. The petitioner No. 1 had preferred appeal before the Appellate Collector who allowed the appeal on 2.5.1980 holding that the petitioner No. 1 was entitled to avail the exemption. The Department had filed a review application before the Government of India which stood transferred to the Customs, Excise & Gold (Control) Appellate Tribunal, New Delhi (hereinafter referred to as 'the CEGAT) after it was constituted and was registered as Appeal No. ED(SB)(T)1138/81-D. The appeal was disposed of on 22.6.1984 setting aside the order of the Appellate Collector dated 2.5.1980 and restoring that of the Assistant Collector dated 12.5.1978. It is the submission of Mr. Ashok Mohanty, the learned Standing Counsel (Central) that since the classification lists as filed by the petitioner No. 1 on the earlier occasion had been held to be rightly rejected by the Assistant Collector, and it was decided that the petitioner No. 1 was not entitled to avail the exemption being not a manufacturer utilising manual process, the subsequent decision of the Assistant Collector on the second batch of classification lists accepting the contrary was wrong and hence the order of rejection of the refund applications should be held ultimately to be correct for which reason the direction of the Appellate Collector should not be enforced. An affidavit has also been filed by the petitioners stating that after the appellate order of the CEGAT was delivered, the Department had filed an application before it for rectification of the order so as to permit the Department to retain the duty collected by it for the period from December 9, 1977 till September 7, 1980 and to permit the assessing officer to finally assess the goods in question for the period 8.9.1980 to 22.4.1981. It is pertinent to note that the period December 9, 1977 to September 7, 1980 is precisely the period to which the present petition relates. The CEGAT rejected such application of the Department on 18.9.1984 holding the same to be not maintainable. The affidavit filed by the petitioners further discloses that as against the appellate order of the CEGAT holding the petitioner No. 1 to be not a manufacturer manufacturing in the process entitled to exemption, the petitioners have moved the Supreme Court of India before which the matter is pending in Civil Appeal No. 3661 of 1984.
2. Mr. B.K. Mohanty, the learned Counsel appearing for the petitioners, has urged that since the Appellate Collector in appeal has passed an order directing refund and the Department had not challenged the same in the forums available under Saw, such order of the Collector must be taken to have become final and hence the Assistant Collector is bound by such order. He, as such, seeks a mandamus to be issued directing the Assistant Collector to refund the excess duty along with the interest accrued thereon to the petitioners. Refuting such stand it is the submission of the learned Standing Counsel that since the classification lists as submitted by the petitioners on the first occasion were found to be incorrect by the CEGAT, the second set of classification lists could not have been allowed by the Assistant Collector reaching conclusion and that for such reason, the refund should not be directed as it has been finally determined that the petitioner No. 1 does not employ a process of manufacturer which entitles it to exemption.
3. Ordinarily we would have accepted the submission of the learned Counsel appearing for the petitioners that as a statutory order in appeal had been passed directing refund, there could be no authority in the Assistant Collector to have still refused the same and that he is bound by the order of his superior authority. Certain facts emanating however urge us to take a constrained view. The Assistant Collector's order in Annexure-5 accepting the second batch of classification lists shows him to have been not influenced by the earlier order of the Appellate Collector approving the first batch of classification lists but to have independently come to the conclusion that the process adapted by the petitioner No. 1 cannot even be called semi-automatic one because neither compressed air nor mechanically operated press is used in the manufacture of glassware and that what is used is manually operated press and hence the petitioner No. 1 is entitled to pay at the concessional rate of duty. Even though the Assistant Collector came to such conclusion, yet the applications for refund were rejected taking the view that no such refund should be made as it would amount to unjust enrichment of the petitioner No. 1 since it had collected the duty from the customers. The Appellate Collector in appeal did not accept the applicability of the theory of unjust enrichment in view of the decision of this Court in OJC 2056 of 1981 and further held that since in the appellate order of the Appellate Collector in the Appeal No. 13/OR/80 dated 2.5.1980, it had been held that the petitioner was entitled to the exemption under the notification No. 329/77 dated 26.11.1977, it was surprising that the Assistant Collector should have rejected the refund applications. The, Appellate Collector was of the view that if the Assistant Collector felt that the order of the Appellate Collector was wrong, he should have moved the matter in revision before the Government of India and he having not done so, did not have authority to reject the refund applications on the ground that it would amount to unjust enrichment. Such reasoning by the Appellate Collector was not correct since in fact the Department had taken the very step which the Appellate Collector found the Assistant Collector not to have taken, i.e. the appellate order of the Appellate Collector in Appeal No. 13/OR/80 dated 2.5.1980 had in fact been challenged before the Government of India in revision which had stood transferred to the CEGAT and was treated as a second appeal there. The Assistant Collector in fact had not decided the second batch of classification lists submitted before him on the basis of the Appellate order of the Appellate Collector, but has done so independently on his own sifting of the materials on record. Thus the very foundation of the Appellate Collector's order on 12.2.1982 was erroneous.
4. As regards the submission raised by the learned Standing Counsel (Central) that the CEGAT having already decided of the classification lists first submitted by the petitioner No. 1 to have been not acceptable a different conclusion accepting subsequently filed similar classification lists could not have been reached, it is to be observed, that at least, theoretically speaking, it is possible for a manufacturer to bring to the notice of the authorities at any point of time that it had in fact been adopting a manufacturing process which would entitle it to an exemption. The CEGAT, while dealing with the matter, was dealing with the classification list No. 13/77. The determination relating to that may be on one set of facts. The Assistant Collector dealing with the second batch of classification lists respectively numbered as 19/78, 18/78, 20/78, 21/78, 22/78 and 1/79 might be considering a further set of facts enabling him to reach a conclusion different than that what had been reached earlier. Again theoretically speaking, a manufacturer may also adopt different processes of manufacture at different points of time. It is for the authorities to ascertain and decide as to whether on a given set of facts the manufacturer would be entitled to exemption. As appears from the order in Annexure-5, the Assistant Collector came to an independent conclusion of the petitioner No. 1 as employing the particular process of manufacture which entitled it to exemption. Again not only the Department's application before the CEGAT to allow it to retain the duty collected during the period December 9, 1977 to September 7, 1980 was rejected as not maintainable, but also in the very appellate order passed by the CEGAT it was made clear that the demand for duty in pursance of the order passed by the CEGAT would have to be confined to the period subsequent to the date of the Review show cause notice, i.e. 23.4.1981 and not for the period prior thereto. It was thus made clear that the demand for the enhanced duty was not applicable to the period under question in this case.
5. Next comes to the question regarding unjust enrichment. While submissions have been made by Mr. Mohanty for the petitioner and countered by the learned Standing Counsel (Central) either for and against the proposition with citations on either side, we find that the order of the Assistant Collector that such refund is not be made to the petitioner No. 1 since it has collected the duty from the customers is not based upon any materials but only upon conjectures. Before an application for refund is turned down on the ground that the burden of the duty has been passed over to the customers, it has to be seen if in fact the burden has been so passed on. It is elementary that before such conclusion is reached the assessee must be called upon to show that it has not passed on the burden and it is equally the duty of the Department also to establish that in fact the enhanced duty has been collected from the customers. As a matter of fact such burden first arises with the Department. It does not appear that any such investigation has been made or the petitioners have been granted opportunity to put forth their case. Considering the facts and circumstances of the case, we feel inclined that this case should go back for re-determination of the issue with full opportunity to the petitioners to show justifiability of the refund. The petitioners may also urge, as is contended here, regarding the inapplicability of the proposition of unjust enrichment. It is the submission of the learned Counsel appearing for the petitioners that such a question may be left to be decided by the Appellate Collector instead of Assistant Collector. We find no reason to reject the request.
6. In the result, the writ petition is allowed, the order passed by the Assistant Collector in Annexure 7-B as also the order of the Appellate Collector in Annexure 7-C are set aside, and the matter is remanded to the Appellate Collector of Central Excise, Calcutta who, after giving notice to the parties concerned, shall determine the question of refund of duty to the petitioner No. 1 in the light of the observations made within a period of three months from the receipt of the writ from this Court. No costs.
K.C. Jagadebroy, J.
7. I agree.