1986 (1) TMI 322 - AT - Central Excise

Summary

Issues:
Claim for refund of excise duty paid on second-hand metal containers, rejection of claim based on time limitation under Rule 11 of Central Excise Rules, 1944, contention of payments made under protest, production of documentary evidence for protests, interpretation of letters as general protests, acknowledgment of protest letters, applicability of Rule 11 on payments made under protest, precedent set by M/s. Pure Drinks Ltd. case.

Analysis:
The case involved a claim for refund of excise duty paid on second-hand metal containers by M/s. Industrial Chemicals Limited for the period from 1-3-1970 to 30-11-1975. The Assistant Collector granted a partial refund, rejecting the balance as time-barred under Rule 11 of the Central Excise Rules, 1944. The Appellate Collector upheld this decision, leading to an appeal before the Tribunal.

The appellants contended that all payments were made under protest, challenging the limitation bar on their refund claim. The Assistant Collector and the Appellate Collector dismissed this argument, citing lack of documentary evidence for protests. The Tribunal noted the appellants' repeated claims of protests but emphasized the need for substantiating evidence.

During the proceedings, the appellants produced a letter dated 23-3-1970 requesting exemption from excise duty for reconditioned drums, acknowledged by the department. This letter explicitly stated the claim for exemption, indicating payments made thereafter were under protest. The Tribunal accepted this letter as a general protest, considering all subsequent payments as made under protest.

The Tribunal rejected the argument that Rule 11 did not save payments made under protest from the limitation bar, citing the precedent set by the M/s. Pure Drinks Ltd. case. Consequently, the Tribunal modified the lower authorities' order and directed the refund of duties paid on second-hand metal containers from 23-3-1970 onwards, deeming all such payments as made under protest and not subject to the limitation bar.

In conclusion, the Tribunal's decision favored the appellants, recognizing their payments as made under protest and ordering the refund of duties paid on second-hand metal containers from 23-3-1970 onwards, based on the interpretation of the letter as a general protest and the applicability of Rule 11 to payments made under protest as established by legal precedent.