1991 (3) TMI 232 - AT - Central Excise

Summary

Issues:
Appeal against order of Collector of Central Excise (Appeals) - Claim of benefit under Notification 85/85 - Rejection of claim as hit by limitation - Interpretation of Para 3 of the notification - Eligibility for concession based on total clearances during financial year - Applicability of Section 11B of the Central Excises & Salt Act, 1944 - Limitation for claiming refund - Date from which limitation should be reckoned.

Detailed Analysis:

1. The appeal challenged the order of the Collector of Central Excise (Appeals), Madras, regarding the appellants' claim for the benefit of Notification 85/85, which was rejected as being time-barred. The appellants, a new manufacturer, started clearing goods by paying duty without initially claiming the notification's benefit. They later realized their eligibility and filed a refund claim after the financial year ended, arguing that the limitation for filing the claim should start from the close of the financial year when the total clearances could be accurately assessed.

2. The appellants contended that the wording of Para 3 of Notification 85/85 indicated that the concession was contingent upon them determining that their clearances would not exceed a certain amount. They argued that since the final clearance amount could only be known at the end of the financial year, the limitation for filing the refund claim should commence from that point. They cited a Tribunal decision supporting their position and emphasized that the critical date for eligibility should be after the period determining the benefit under the notification.

3. The Respondent, however, argued that the benefit under Notification 85/85 was linked to total clearances during the financial year, and the claim could have been made at the beginning of the year. They relied on Section 11B of the Central Excises & Salt Act, 1944, which mandated that refund claims must be filed within six months from the date of duty payment. Since the refund claim was submitted beyond this period, they contended that the claim was time-barred.

4. In analyzing the issue, the Tribunal referred to a similar case where the Special Bench held that the limitation for claiming a refund should be from the date of duty payment, not the end of the financial year. They cited a judgment of the Division Bench of the High Court of Kerala to support this view, emphasizing that the claim for refund must align with the duty payment date. Following this precedent, the Tribunal concluded that the limitation for claiming a refund under Section 11B should be reckoned from the date of duty payment, dismissing the appeal on the grounds of being time-barred.

In conclusion, the Tribunal upheld the order rejecting the refund claim, emphasizing that the limitation for claiming a refund under Notification 85/85 should be calculated from the date of duty payment, as per Section 11B of the Central Excises & Salt Act, 1944. The decision highlighted the importance of aligning refund claims with duty payment dates rather than the end of the financial year for determining eligibility under such notifications.