LexM/S. SAHAKARI KHAND UDYOG MANDAL LTD. versus COMMISSIONER OF CENTRAL EXCISE AND CUSTOMS
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A M/S. SAHAKARI KHANO UDYOG MANDAL LTD. v. COMMISSIONER OF CENTRAL EXCISE AND CUSTOMS MARCH 9, 2005 B [RUMA PAL, ARIJIT PASAYAT AND C.K. THAKKER, JJ.] Central Excise and Salt Act, 1944; Item No. I of First Schedule to the Act, Section I IB; Exemption Notification Nos.257176 and 108178: C Exemption Notification-Exemption from levy of excise duty on production of sugar in excess of average production in the preceding three years-Refund claim-Held : Benefit of exemption could be claimed only if levy sugar and free sale sugar are sold in certain prescribed proportion I dur(ng prescribed period-But assessees sold it in different proportion- D Revenue had rightly calculated the refund amount in consonance with the Notification-However, the claim is time barred. E Doctrine of unjust enrichment-Applicability of-Held: Its applicability is based on equity-Since assessee had already 11'ecovered the amount from the customers, refund, if allowed, would result in unjust enrichment. Appellant-assessees, manufacturer of sugar had claimed rebate on the basis of Exemption Notification No. 257176. The Notification provides for exemption from payment of excise duty leviable thereon in excess of average production of sugar for the preceding three years. Revenue found that the assessees had sold levy sugar and free sale sugar in different proportion to F what was specified in the Notification and one of the requirements for claiming benefits under the Notification, therefore, reduced the claim in consonance with the N~ation and also found that assessees had already collected the duty amount from customers, as such they were not entitled to claim the amount. Hence, the amount was transferred to customer's welfare fund. G Appellate Authority and also the Tribunal affirmed the order. Hence the present appeals. H Dismissing the appeals, the Court HELD : 1.1. The appellant-assessee is not entitled to any relief. On 606 - SAHAKARI KllAND UDYOG MANDAL LTD. 1·. C.C.E.C. 607 limitation, it is clear from the record that the claim was in respect of the A production for the year 1976-77. The assessee ought to have filed the claim up to 31st March, 1978. But the claim was submitted on August 14, 1978. It was, hence, rightly held to be barred by limitation. However, regarding average production of sugar for three years in the connected appeal, the submission of the respondent is well founded that the average production of B two years had to be considered in terms of Notification No. 108/78. f 615-D-E-FI Sidheshwar Sahakari Sakhar Karkhana Ltd v. Union of India and Ors., Civil Appeal No. 5866 of 1999 .decided S.C. on 23rd February, 2005, relied on. l.2. Both the Notifications are abundantly clear. The benefit of exemption under the said Notifications can be claimed only if sugar is sold in the proportion of 65:35 levy sugar and free sale sugar respectively. Since the assessee was claiming the benefit of exemption of 65:35, it was obligatory on c the assessee to sell sugar in the ratio as specified in the Notifications and unless D that condition is fulfilled, the benefit of exemption from duty could not be claimed by it. On the basis of actual sale by the assessee, the Revenue had calculated the amount of exemption from excise duty which was in consonance with the Notifications and no grievance can be made by the assessee against that decision. 1616-F-GI 2.l. 'Unjust enrichment' means retention ofa benefit by a person that is unjust or inequitable. 'Unjust enrichment' occurs when a person retains money or benefits which in justice, equity and good conscience, belong to someone else. The doctrine of 'unjust enrichment' is that no person can be allowed to enrich inequitably at the expense of another. A right of recovery under the doctrine of 'unjust enrichment' arises where retention of a benefit is considered contrary to justice or against equity. 1618-B-Cf Mafatla/ Industries Ltd and Ors. v. Union of India and Ors., f 197715 SCC 536: (1997) 99 ELT 247; Union of India v. Jain Spinners Ltd, (19921 4 SCC 389 and Union of India v. l T.C. Ltd., (1993) Supp 4 SCC 326, relied on. Hindustan Metal Pressing Works v. Commissioner of Central Excise, Pune, 120031 3 sec 559, distinguished. E F G 2.2. The doctrine of'unjust enrichment' is based on equity and has been accepted and applied in several cases. Therefore, irrespective of applicability H 608 SUPREME COURT REPORTS [2005] 2 S.C.R.
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