Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2019 Supreme(SC) 189

SUPREME COURT OF INDIA
A.M. Khanwilkar, Ajay Rastogi, JJ.
WESTERN COALFIELDS LTD – Appellant
Vs.
COMMISSIONER OF CENTRAL EXCISE TRICHY/MADURAI – Respondent
Civil Appeal No (s). 807 of 2006 with Civil Appeal No(s). 7625 of 2005; Civil Appeal No (s). 3217-3218 of 2010; Civil Appeal No. (s). 8439-8440 of 2011; Civil Appeal No.(s). 9693-9694 of 2011; Civil Appeal No.(s). 4992 of 2012 and Civil Appeal No. (s). 4826 of 2012
Decided on : 20-02-2019

Advocates:
Advocated Appeared:
For the Appellant : Mr. Ajit Kr. Sinha, Sr. Adv. In 103.1 to 103.6 Mr. Ambhoj Kumar Sinha, AOR Ms. Moni Priya, Adv., Ms. Deepika Nandakumar, Adv. For Mr. V. N. Raghupathy, AOR
For the Respondent: Mr. K. Radhakrishan, Sr. Adv. Ms. Sunita Rani singh, Adv. Ms. Shirin Khajuria, Adv. Ms. Aruna Gupta, Adv. Mrs. Anil Katiyar, AOR Mr. B. Krishna Prasad, AOR Mr. Arvind Kumar Sharma, AOR

IMPORTANT POINT
Application for refund of excise duty made after period of limitation is liable to be dismissed.

Headnote:Central Excise Act, 1944 – Section 11B – Refund of excise duty – Rejection of claim – Excise duty was paid by manufacturer under protest to department and dispute with regard to classification of product finally came to be decided by High Court and manufacturer never moved any application for refund of excise duty at any given point of time – Scheme of Section 11B makes a distinction between right of manufacturer to claim refund from right of buyer to claim refund treating them separate and distinct for making application for refund exercising their right under Section 11B of Act – Period for which refund of excise duty has been claimed differs but in all cases, applications have been filed by appellant(buyer) much after period of limitation which was six months from date of purchase of goods at the time of filing of application to claim refund under Section 1 1B of Act – Appeals dismissed. (Paras 11, 12, 14 and 15)
       Facts of Case:
       Present batch of appeals are directed against judgment and order passed by Customs, Excise and Service Tax Appellate Tribunal, at South Zonal Bench, Chennai rejecting claim of appellant (buyer) for refund of claim of central excise duty under Section 11B of Central Excise Act, 1944 which was paid under protest by manufacturer. Short point for consideration in present batch of appeals is whether period of limitation of six months shall apply where refund of central excise duty has been claimed by buyer and paid by manufacturer under protest.
       Findings of Court:
       Section 11B deals with claim of refund of duty as paid on his own accord by any person for refund of such duty to competent authority before expiry of six months from relevant date as prescribed but where the duty was paid under protest in terms of 2nd proviso to Section 11B(1), period of limitation may not apply. Although buyer can also apply for refund provided duty of excise is borne by buyer and he had not passed on incidence of such duty to any other person as referred to under Section 11B(2)(e) and application has been moved within period of six months from relevant date of purchase of goods by such person in terms of Section 11B(5)(B)(e) of Act.
       Result – Appeals dismissed.

JUDGMENT

Rastogi, J.

The present batch of appeals are directed against the judgment and order passed by the Customs, Excise and Service Tax Appellate Tribunal, at South Zonal Bench, Chennai(hereinafter being referred to as "Tribunal") rejecting the claim of the appellant (buyer) for refund of the claim of the central excise duty under Section 11B of the Central Excise Act, 1944(hereinafter being referred to as "the Act") which was paid under protest by the manufacturer (M/s. Fenner (India) Ltd.).

2. The short point for consideration in the present batch of appeals is whether the period of limitation of six months shall apply where the refund of central excise duty has been claimed by the buyer and paid by the manufacturer (M/s. Fenner (India) Ltd.) under protest.

3. With the consent of the parties, we are dealing with the facts of Civil Appeal No. 7625 of 2005 as all other are analogous on facts and law.

4. The appellant is a Public Sector Undertaking engaged in coal mining. The price of coal is fixed by the Coal Ministry and the appellants sell the goods on the price fixed by the Ministry and no central excise duty is payable on coal. M/s. Fenner (India) Ltd.(manufacturer) cleared their finished goods viz. feneplsat PVC impregnated conveyor beltings classifying the same under sub-heading 3920.12 on the Central Excise Tariff Act, 1985 as suggested by the department and paid the duty under protest. The dispute with regard to classification of feneplast PVC impregnated conveyor beltings came to this Court and finally decided vide judgment dated 28th March, 1995(M/s. Fenner (India) Ltd. Vs. Collector of Central Excise, Madurai reported in 1995 (Suppl.) 2 SCC 567) holding that the conveyor beltings would be classifiable under sub-heading 3922.90 for the period from December 1986 to February 1987 and under subheading no. 3926.90 for the period from 10th February 1987 to June, 1987 and also for the later period. Indisputedly, M/s. Fenner (India) Ltd. pending classification deposited central excise duty under protest and had never applied for its refund after the classification dispute was finally decided by this Court of which a reference has been made.

5. The appellant herein is the buyer of conveyor beltings from M/s. Fenner (India) Ltd. filed application for claim of refund on 20th December, 1996 for the period 20th July 1988 to 15th January 1994 on the premise that the payment was made towards central excise duty by the manufacturer (M/s. Fenner(India) Pvt. Limited, Madurai) under protest due to pending classification of PVC impregnated conveyor beltings dispute in the Court of law and after issue of classification has been settled by this Court in favour of the manufacturer M/s. Fenner (India) Ltd. by judgment dated 28th March, 1995, the central excise duty collected should be refunded by the excise department and there is no bar in claiming of refund in terms of the amendment made under Section 11B of the Act and limitation of six months shall not apply where duty has been paid under protest.

6. In furtherance of the application, show cause notice dated 17th February, 1997 was served by the Department holding that since the appellant did not pay any duty and, therefore, is precluded from making any application under Section 1 1B of the Act and after affording opportunity of hearing order in original came to be passed by the Authority dated 4th August, 1997 rejecting the refund application filed by the appellant on the ground of limitation and also on unjust enrichment. The appeal preferred by the appellant against order dated 4th August, 1997 before the Appellate Authority, Chennai came to be rejected on the ground of limitation under Order dated 18th January, 1999 and confirmed by the Appellate Tribunal under order impugned dated 8th August, 2005 placing reliance on the judgment of this Court in Commissioner of Central Excise, Mumbai-II Vs. Allied Photographics India Ltd. 2004(4) SCC 34. The subject matter of challenge is in appeal

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Judicial Analysis

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2019 Supreme(SC) 189

IMPORTANT POINTApplication for refund of excise duty made after period of limitation is liable to be dismissed.

Cases Referred (3)

Judicial Analysis

IMPORTANT POINT
Application for refund of excise duty made after period of limitation is liable to be dismissed.