TMI Blog1990 (10) TMI 177X X X X Extracts X X X X X X X X Extracts X X X X ..... % ad valorem applicable under T.I.68 during the period 1-3-1982 to 22-4-1982. From 22-4-1982, the said goods were totally exempt from duty by virtue of Notification No. 149/82 dated 22-4-1982 which exemption was continued even after the passing of the Finance Bill on 10-5-1982 vide Notification No. 182/82 dated 11-5-1982. From 10-5-1982, the said goods were classified under T.I. 68. During the period from 1-3-1982 to 22-4-1982, the said goods attracted central excise duty under T.I.15A(2) and were liable to pay basic excise duty @ 8% ad valorem and special excise duty @ 5% of BED. As the assessee had already paid BED @ 8% ad valorem, though under T.I.68, the department raised demand only for special excise duty, @ 5% on the said goods which the assessee paid. Then, the assessee submitted a refund claim for the duty paid on the said goods for the period from 1-3-1982 to 22-4-1982 under T.I.68. Show cause notice was issued and on adjudicating the show cause notice, the Assistant Collector rejected the claim holding that the goods should have been cleared on payment of BED @ 8% ad valorem and special excise duty @ 5% of BED under T.I.15A(2), but the assessee continued to pay the duty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... referred to by them during arguments. The assessee did file some documents, which we have perused. 7. L.A., Dr. Jois cited Bharat Commerce of Industries Ltd. v. Union of India and Others reported in 1979 (4) E.L.T. (J527) (Del.) wherein it has been held as under: If the levy and assessment of goods under one particular Tariff Item is held to be illegal, the department cannot refuse to refund the amount on the ground that duty could have been levied under any other Tariff Item because on that basis the department has to issue an appropriate demand within the time limit of Rule 10." (ii) Western Bengal Coal Fields Ltd. v. UOI reported in 1989 (43) E.L.T. 27 (Bom.) wherein the same principle has been laid down. 8. The ld. D.R. submitted that decision of the Delhi High Court is per incuriam, but he could not show how it was so. 9. Admittedly, in the instant case, the Assistant Collector had sought to adjust BED paid by the assessee under T.I.68 against BED demandable under T.I.15A(2). It is also an admitted position that subsequently realising that the classification under T.I. 68 was not proper, department did raise a demand for special excise duty @ 5% of BED under T.I.15 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re required to pay the amount of basic duty at the rate of 8% therefore the amount had been correctly paid albeit under a different heading. In the circumstances to claim that the amount was refundable on a hyper-technical plea of having deposited it under an incorrect tariff heading is rather far-fetched. It is the primary duty of an assessee to pay the amount not only correctly but under the proper heading (and it is equally the duty of the departmental officers to collect the amount under the correct heading) but if by mistake or otherwise an incorrect heading is shown, the amount which is otherwise paid correctly, does not become refundable in my opinion. 16. Even in case of a show cause notice, where a charge is correctly framed and the language is clear enough to bring home the substance of the charge, a mere incorrect mention (or even non-mention) of a sub-section does not vitiate the proceedings; and it has been repeatedly held by this Tribunal that such minor errors or infractions are not required to be taken serious note of and if the matter is otherwise in order, the proceedings are not invalidated. 17. On the same analogy if the amount of basic duty was correctly pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iously two schools of thought in this respect prevalent at that time. 21. The learned DR s contention that the judgments of the High Courts and the orders of the Tribunal cited by Dr. Joseph were all per incuriam is rather unusual and appears far-fetched. These judgments and orders were obviously passed in accordance with the position in law as understood at the time they were announced and a subsequent change in interpretation does not render previous judgments and orders per incuriam. It was of course open to the learned SDR to distinguish these cases or to show the latest position in law but such sweeping generalisation was hardly called for; and I am in full agreement with my learned brother Member (Judicial) in observing that the department has not succeeded in showing that these judgments and orders were per incuriam. At the same time it is true that the prevailing judicial opinion is in favour of considering the date of clearance as the relevant date for purpose of applying exemption notification and determining the effective rate of duty. Indeed the controversy has since been laid to rest by the latest judgment of the Supreme Court in the case of Wallace Flour Mills Limit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and circumstances of the case the amount of basic excise duty paid at the rate of 8% ad valorem was correctly retained by the department or it was refundable. 27. [Order per : G. Sankaran, President]. - The two Learned Members, who heard the subject matters in the first instance, could not agree on the manner of disposal of Appeal No. E/2815/85-C filed by the Collector of Central Excise, Bombay-II. The Member (Judicial) took the view that since the Department had not raised a legally valid demand for the basic excise duty leviable under Item No. 15A(2) of the Central Excise Tariff Schedule ( CET , for short) as in force at the material time, the duty paid, admittedly erroneously, under Item No. 68, CET, could not be adjusted against the duty leviable under Item No. 15A(2). In this view of the matter, he proposed an order dismissing the Collector s appeal. The Member (Technical), on the other hand, proposed an order allowing the appeal on the basis that the amount of duty collected under Item 68, CET, could be validly adjusted against the duty leviable under Item 15A(2). In view of this difference of opinion between the two Members, they formulated the following point for conside ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the main dispute between the parties was one of classification and the goods having been found to be classifiable under the item claimed by the appellants, the Tribunal stated that there was no good reason why the appellants should not be called upon to pay so much of the duty appropriately quantifiable under the item claimed by them subject, of course, to other procedural safeguards like limitation, demand not exceeding the one originally made etc. This was on the basis that Courts and Tribunals have full powers to mould the relief in a case according as the ends of justice require. Accordingly, the Tribunal held that the Department was entitled to recover duty payable under Item No. 15A(I)(ii) to the extent the demand notice (under Item 68) had been made within limitation subject to the amount recoverable in terms of the revised classification not exceeding the amount originally claimed under Item No. 68. Relying on this decision, Shri Chakraborti, DR, submitted that the view of the Learned Member (Technical) was the more appropriate one. 30. Shri Chakraborti also relied on the Tribunal s decision in Premier Tyres Ltd. v. Collector of Customs, Madras -1984 (16) E.L.T. 419 (par ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roceedings resulting in confirmation of the demand. Any adjustment as envisaged by the Department would be illegal. In this connection, he relied on the Delhi High Court s judgment in Bharat Commerce Industries Ltd. v. UOI Others - 1979 (4) E.L.T. J527. In that case, the Court had held that while it might be legitimate for the Revenue to adjust a refund payable to an assessee against other amounts of duty payable by him in accordance with law, it was certainly not open to it to make such an adjustment against a demand which had not been and which could not be made. The orders of the Appellate Collector and the revisional authority directing such appropriation by way of adjustment were declared to be wholly illegal and without jurisdiction. The Learned Counsel also relied on the Madras High Court judgment in The Maritime Collector of C. Ex., Madras, and Another v. The East Asiatic Co. (India) Ltd. -1982 ECR 882. In that case, the Revenue had sought to adjust a demand, admittedly barred by limitation, against amounts with the Department due to be refunded to the respondent. The question before the Court was whether the time barred claim of the Revenue could be deducted from the m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mand basic excise duty under Item 15A. There is, therefore, no amount of basic excise duty under that item which, in the eye of law, was recoverable from the assessee. If this be so, it follows that the amount of basic excise duty collected under the admittedly wrong Item 68, CET, cannot be retained by the Department because that would be retention of an amount of money purported to be tax basic excise duty under Item 15A - but retained without the authority of law. 34. The above view gains support from the Bombay High Court s judgment in Western Bengal Coal Fields Ltd. v. Union of India -1989 (43) E.L.T. 27. In that case, the Assistant Collector sought to recover by adjustment what he alleged was short levied duty. The Court observed that the only procedure for recovery of what had been short levied was that provided by Section 11A of the Act. There was no resort to the provisions of that section. Nor was there any determination that a certain sum of money had been short levied. The recovery or adjustment in the manner sought by the Department could not be made. 35. In Indian Plywood Manufacturing Co. Ltd. v. Collector of Central Excise, Bangalore -1985 (22) E.L.T. 144, the Tr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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