COMMISSIONER OF CENTRAL EXCISE, MUMBAI-II versus M/S ALLIED PHOTOGRAHICS INDIA LTD.

Citation: [2004] 3 S.C.R. 261 · Decided: 18-03-2004 · Supreme Court of India · Bench: V.N. KHARE · Disposal: Appeal(s) allowed

Judgment (excerpt)

• .> 
COMMISSIONER OF CENTRAL EXCISE, MUMBAI-II 
A 
v 
MIS ALLIED PHOTOGRAHICS INDIA LTD. 
MARCH 18, 2004 
[V.N. KHARE, CJ., S.B. SINHA AND 3.h KAPADIA, JJ.] 
B 
Central Excise Act, 1944-Section 11 B-Unjust enrichment-
Applicability of-Making of refimd and claiming of refund-Difference 
between-Payment of duty under protest-Nature of-Held, is different than C 
duty paid under provisional assessment-Duty paid by the manufacturer under 
protest-Burden of duty passed on to buyer/distributor-Subsequently, duty 
revised by Department-Distributor claiming refund-Held, Section 11 B would 
be applicable-Central Excise Rules, 1944-Rule 9 B. 
Constitution of India-Article 136-Concurrent findings of fact- D 
lnte(ference with-lower authorities not examining relevant facts while arriving 
at findings of fact-Held. can be interfered with-Central Excise Act. 1944-
Section 11 B. 
Respondent was the sole distributor of NHL. The Excise Department 
sought to recover excise duty from NHL on the basis of the price charged E 
by the respondent to its dealers and not the price declared by NHL as 
wholesale cash price. NHL paid the amount demanded by the Department 
under protest and appealed against the said demand. The appeal filed by 
NHL was dismissed. 
In view"of subsequent judgment in Union of India and Ors. v. Bombay F 
Tyre International, AIR (1984) SC 420, which held that distributor c·ould 
not be treated as "related person" under Section 4 (1) (a) of the Central 
Excise Act, 1944 the Department, on 31.10.1984, approved ex-factory price 
of NHL as value under Section 4 of the Central Excise Act. NllL filed claim 
for refund. The Assistant Commissioner granted only two months' refund. G 
NHL filed writ petition where it concede that it had passed on the 
burden of the duty to the respondent. The High Court however granted 
refund to the respondent holding that the appellant had failed to prove 
that the respondent had passed on the burden of the duty to its consumers. 
261 
H 
262 
SUPREME COURT REPORTS 
[2004] 3 S.CR. 
A The matter ultimately came in appeal to the Court. The Court held that 
..I.. .. 
as NllL had passed on the burden of duty to the respondent, its refund 
-
claims were liable to be rejected. However, the Court observed that the 
order would not prevent the respondent from adopting appropriate 
remedies open to it in law. 
B 
After the judgment of the Court in Mafat/a/ Industries Ltd. v. Union 
of India, [1997J 5 SCC 536, on ll.2.1997, the respondent filed refund claim 
before the Department. The claim of the respondent was allowed by the 
Assistant Commissioner. The Department filed an appeal to the 
(. 
Commissioner (Appeals) but the appeal was dismissed. The Tribunal, on 
c appeal, also affirmed the order passed by the Commissioner. 
The appellant filed appeal before the Court. The respondent, 
defending the impugned judgment contended that deposit of duty under 
protest stood on the same footing as a provisional assessment under Rule 
98 of the Central Excise Rules, 1944 both being in the nature of "on 
D account" payment and therefore, in view of observations of the Court in 
para 104 of Mafalfa/ Industries ltd. v. Union of India, [19971 5 SCC 536, 
resort to Section 11 B of the Central Excise Act was not necessary. The 
'r • 
respondent further contended that it had stopped into the shoes of the NHL 
and therefore, the amount payable to NHL should be paid to it. It was 
E 
also contended that the concurrent finding of facts should not be interfered 
with. 
Allowing the appeal, the Court 
· HELD: l. l. There is a basic difference between duty paid under 
F 
protest and duty paid under Rule 9 B of the Central Excise Rules, 1944. 
The duty paid under protest falls under Section 11 B of the Central Excise 
.4 
Act, 1944 whereas duty paid under provisional assessment falls under 9 
B of the Central Excise Rules. Section 11 B of the Central Excise Act deals 
with claim for refund whereas Rules 9 B of the Central Excise Rules deals 
with making of refund, in which case the assesssee has not to comply with 
G Section 11 B of the Central Excise Act. Therefore, Section 11 B of the 
Central Excise Act and Rule 9 B of the Central Excise Rules operate in 
different spheres. 1279-G-H; 280-AI 
r: 
1.2. Rule 9 B of the Central Excise Rules is a complete code by itself. 
On Compliance with the conditions therein, the proper officer is duty 
H bound to refund the duty without requiring the assessee to make a separate 
C.C.E. 

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