Assessee Ineligible For Excise Duty Refund On Ambulances, Neither Manufacturer Nor Buyer U/S 11B(2)(e) Central Excise Act: CESTAT

S.S. Garg (Judicial Member) and P. Anjani Kumar (Technical Member) observed that the assessee is not a manufacturer or a buyer of the Ambulances, the differential duty paid on which the assessee seeks to claim as a refund. The Ambulances are not registered in their names. They are not the owners of the vehicles.

In this case, the assessee/appellants have signed an MOU with the Government of Karnataka as a partner to run the ambulance service named “Arogya Kavacha”.

The applicant ordered the supply of vehicles from various manufacturers on behalf of the state government, which, on clearance and after payment of Central Excise duty, were sent to the fabricator M/s Bafna Healthcare Private Limited at Faridabad (M/s BHPL).

Revenue entertained a view that the fabrication of ambulances by M/s BHPL amounted to manufacture and therefore, M/s BHPL were required to pay Central Excise duty on ambulances cleared to the Government of Karnataka. M/s BHPL paid the duty under protest.

The assessees filed a claim, seeking a refund of the Central Excise duty paid by M/s BHPL under protest. The claim was rejected by the Assistant Commissioner on the ground that the Notification No.6/2006-CE dated 01.03.2006 envisages a refund to the manufacturer, and the assessee, not being the manufacturer, was not entitled to the refund claim.

The assessee filed an appeal before the Commissioner (Appeals), which directed the authority to deal with the refund claim on merits as per the existing procedure and provisions.

Accordingly, a Show Cause Notice was issued. The original authority rejected the refund, and such rejection was upheld by the impugned order.

The assessee submitted that they placed orders on behalf of the State Government, for the supply of vehicles from various manufacturers and applicable duty was paid on the said 'Delivery Vehicles' under CETH 8704 21 90. The vehicles are sent to fabricators to convert them into ambulances meant for emergency services.

The assessee argued that they have paid duty on behalf of the Government of Karnataka, which has also given a No Objection Certificate, and they are eligible to claim the refund.

The revenue opined that as the Central Excise duty was paid correctly, there was no excess payment of duty, for which the instant refund claim has been filed. The assessees were neither a manufacturer nor a buyer of the said vehicles and thus cannot be considered as the buyer for the purpose of Section 11 B(2)(e) of the Central Excise Act, 1944.

Regarding the refund, the Tribunal opined that the Central Excise Law recognises only the manufacturer for the purposes of payment of duty. It also recognises the Purchaser of the vehicles for the purposes of the Refund. The assessee is not established to be either of them. He is not even a consumer. The assessee could not produce any evidence to show that they are the buyers or owners, or consumers of the vehicles, who have borne the incidence of duty and have not passed it on to others.

The bench held that the assessees are neither a manufacturer nor a buyer nor the owners of vehicles and thus have not fulfilled the substantive conditions for refund.

In view of the above, the Tribunal rejected the appeal.

Case Title: M/s GVK Emergency Management and Research Institute v. Commissioner of Central Excise, Delhi

Case Number: Excise Appeal No. 51956 of 2014

Counsel for Appellant/ Assessee: None

Counsel for Respondent/ Department: Anurag Kumar and Amita Gupta

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