2003 (3) TMI 116 - SC - Central Excise

Whether purchaser who claims refund under Section 11B must do so within six months of the date of purchase of the goods? Held that - Section 11B was amended in 1991. After the amendment by virtue of sub-clause (a) in Explanation B of Section 11B even a purchaser can claim refund. A manufacturer has to file his claim for refund within six months from the relevant date. The purchaser also has to file a claim for refund within six months from the date of purchase of the goods. As before refund can be claimed either by the manufacturer or by the purchaser the conditions of Section 11B must be fulfilled viz. it must be shown that the amount of duty of excise in relation to which such refund is claimed was collected from or paid by the person claiming refund and that the incidence of such duty has not been passed on by him to any other person. Therefore even in a claim for refund by the purchaser he would have to satisfy the Department that these conditions are fulfilled before any refund can be made to him. In this view of the matter we remit the matter back to the appropriate authority for consideration in the light of the law laid down herein.

Summary

Issues:
Interpretation of Section 11B regarding the time limit for claiming refund under excise duty law.

Analysis:
The Supreme Court considered appeals against a decision of the Larger Bench of the Customs, Excise, and Gold (Control) Appellate Tribunal (CEGAT) regarding the time limit for claiming a refund under Section 11B of the excise duty law. The majority view held that a purchaser claiming a refund must do so within six months of the date of purchase of the goods, even if the manufacturer paid the duty under protest. The relevant portion of Section 11B was examined, emphasizing the proviso that exempts the limitation of six months when duty is paid under protest. The Court noted that the wording of the proviso does not require a protest to be lodged by the purchaser, as duty is typically paid by the manufacturer who lodges the protest. The Court interpreted the proviso broadly to cover all claims for refund, including those by the purchaser. Consequently, the majority view was rejected, and the impugned judgment was set aside.

The Court clarified that for both manufacturers and purchasers to claim a refund under Section 11B, certain conditions must be met. The claimant must demonstrate that the duty in question was collected from or paid by them, and that the burden of the duty was not transferred to another party. Therefore, whether the claim is made by a manufacturer or a purchaser, these conditions must be satisfied before a refund can be granted. The Court emphasized the importance of fulfilling these conditions for any refund claim.

In light of the interpretation provided, the Court remitted the matter back to the appropriate authority for reconsideration based on the legal principles established in the judgment. The appeals were disposed of accordingly, with no order as to costs. The decision clarified the application of Section 11B in excise duty refund claims, ensuring that both manufacturers and purchasers adhere to the specified conditions before claiming a refund.