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Commissioner of Central Excise Bangalore Versus M/s. Karnataka Pressure Vessels Pvt. Ltd.

2016 (11) TMI 15 - CESTAT BANGALORE

Claim of refund - Interest on delayed refund - limitation bar - Section 11BB - Price variation clause - manufacture of LPG gas cylinders, for supply to oil companies such IOCL, BPCL, HPCL - Held that: - Refund of any amount paid as excise duty can be refunded subject to provisions of Section 11B of the Central Excise Act. This will require filing of refund claim within the time limit prescribed therein and observance of all other conditions. It is an admitted position in the present dispute that .....

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ses where assessments are provisional, starts from the date of finalisation of provisional assessments. In the present case, if the assessments are deemed to be provisional, then the time limit has to start from the date of its finalisation. It has been confirmed by the learned advocate appearing for the assessee that the adjustment and finalisation of the prices were completed by October 2001. We are of the view that the deemed provisional assessments are to be deemed as finalised by this date. .....

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ppeal disposed off - decided against Appellant. - E/309/2008 & E/2398/2011 - Final Order No. 21014 - 21015 / 2016 - Dated:- 26-10-2016 - Shri S. S. Garg, Judicial Member And Shri V. Padmanabhan, Technical Member Shri Raghavendra B. Hanjer, Advocate For the Appellant Shri Mohammed Yousuf, AR For the Respondent ORDER Per V. Padmanabhan The present order has been passed in compliance of the direction of the Hon ble High Court of Karnataka in CEA No.32 of 2014. The Hon ble High Court set aside the T .....

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s is covered by contracts with a price variation clause. The disputed period is July 1999 to October 2000. The assessee paid central excise duty on the gas cylinders at the time of clearance from their factory on the provisional price communicated by the oil companies. On a date subsequent to clearance, the oil companies finalise the price and if the final price is more than the provisional price, the differential price is paid to the assessee and in cases where the final price is lower, the ass .....

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were provisional. Further, he held that provisional assessments were never resorted to under Rule 9B and hence, the claim is time barred in terms of Section 11B. When the order was challenged before the Commissioner (A), he allowed the refund relying on the ratios of the decisions of the Hon ble Tribunal in the case of Narayana Construction co. Vs. CCE, Hyderabad 2006 (74) RLT 713 (CESTAT-Bang.) and CCE, Tirupati vs. Kurnool Cylinders Pvt. Ltd.: 2007 (78) RLT 616 (CESTAT-Bang.). Revenue has cha .....

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ppeal No. E/2398/2011. 3. Heard Shri Raghavendra B. Hajer, learned advocate for the assessee and Shri Mohammed Yousuf, learned AR for the Revenue. 4. The Revenue s submission is that refund of any amount paid as Central Excise duty is governed by the provisions of Section 11B. Since the refund claim stands filed on 24.8.2006 for duty paid during the period July 1999 to October 2000, the same is hit by time bar, inasmuch as the claim stands filed very much beyond the time limit of one year in Sec .....

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e, which stands finalised on a date subsequent to clearance of the goods. He submitted that even though the formalities regarding provisional assessment as required under the Rule 9B of Central Excise Rules have not been observed, the assessments are to be considered as deemed provisional assessment in view of the price variation clause. He further submitted that the Commissioner (A) has allowed the refund in their favour relying upon the Tribunal s decisions in Kurnool Cylinders case (supra) an .....

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s held that all refunds need to be subject to the provisions of limitation under Section 11B of the Central Excise Act. He placed reliance on various case laws including: (i) Josh P. John and Ors. Vs. CCE vide Final Order No.21349 to 21469/2014 dated 20.8.2014 (ii) CC vs. Anam Electrical Manufacturing Co.: 1997 (90) E.L.T. 260 (S.C.) 7. In respect of appeal No.E/2398/2011, the issue is in a short compass. If refund is held as payable, the related question in this appeal is whether the interest i .....

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e provisional for whatever reason. In such cases, the time limit will start only from the date of finalisation of the provisional assessment. 8.1 Admittedly, the assessee has price variation clause in its purchase orders with the buyers. The effect of such a clause is that the price gets finalised on a date subsequent to the date of clearance of the goods on payment of duty from the assessee s factory. In the present dispute, for clearances made during the period July 1999 to October 2000, the p .....

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s provisional, even though there is no order to the effect by the proper officer under the erstwhile Rule 9B which governs provisional assessments. The Commissioner (A) allowed the sanction of refund following the decision of the Tribunal in the Kurnool Cylinders case (supra) wherein the Tribunal has held that the assessments may be deemed to be provisional under Rule 9B even though the formalities have not been observed. To the pointed query from the Bench, the learned advocate appearing for th .....

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