Applicability of the properties of Limitation Act.

T. Sathiadev, J.

1. Defendants in O.S.No.339 of 1977 on the file of the Sub Court, Dharmapuri, are the appellants. The plaintiff-respondent filed a suit to recover Rs. 13,839.60. It was claimed in the plaint that the plaintiff firm was manufacturing matches and for the period from 22-7-1967 to 31-12-1974, it paid excise duty at the rate of Rs. 3.75 per gross of matches of 50 boxes. Third defendant issued a demand notice dated 4-6-1975 claiming that the Supreme Court of India by judgment dated 4-11-1974 had held that the duty leviable was Rs. 4.30 per gross of matches of 50 boxes and hence called upon plaintiff to pay the differential duty of Rs. 33,152.62. Later on, it was asked to pay one third of the amount, viz., Rs. 11,839.20 and it was paid under protest. There was no short levy or non-payment of duty under Rr. 9, 10 and 10-A of the Central Excise Rules, hereinafter referred to as the 'Rules'. Rule 10 had been struck down by this Court. Rule 10 governs the case of non-payment of short levy. Under the law, the authorities have no power to collect any duty beyond the period of three months prior to the date of demand notice, and this has been finally decided in W.P.No. 4145 of 1975 and which applies to the facts and circum stances of this case. Hence, the suit had been filed to recover the illegally collected amount with interest at 12 per cent from date of payment.

2. Third defendant stated that plaintiff was al lowed concessional rate duty at the rate of Rs. 3.75 per gross from 22-7-1967 to 31-12-19.74, as per the Notification No. 162 of 1967 dated 21-7-1967. This Notification was amended by Notification No. 205 of 1967 dated 4-9-1967, which introduced certain conditions for grant of concessional rate of Rs. 3.75 per gross. Plaintiff did not comply with the conditions, and hence, was bound to pay Rs. 4.30/- per gross. As a result of the decision of the High Court of Madras striking down Clause (b) and (i-a) of the Proviso to Notification No. 162 of 1967 amended by Notification No. 205 of 1967, plaintiff allowed a concessional rate of assessment as per the declaration filed every year and without prejudice to the rights of department. Department had filed an appeal before Supreme Court against the said judgment and it was al lowed. Hence, plaintiff ought to have paid Rs. 4.30 but the amount could not be collected from time to time, because of the pendency of the matter in the Supreme Court. Therefore, he was called upon to pay the differential duty of Rs. 33,152.62 but since similarly placed match manufacturers pleaded inability to pay huge amounts. Government of India took a lenient view and ordered that if one-third of the amount which had become due was paid by 30-9-1975, then two-thirds of the amount would be recovered. Taking advantage of this concession, plaintiff paid the amount without any protest, Hence there is no question of any time limit being applied and it is not barred by limitation. There is no question of any short levy. Rule 10 does not govern the levy and collection in this case. The decision in Mahahoob Bani Beevi v. Inspector, Central Excise H.O.R. II, Kovilpatti, W.P.No.4145 of 1975, is not applicable to this case. It is equally correct to state that R.11 does not apply to make the necessary applications before the proper Officer, within the period pre scribed for refund of amount under Rule 11, the present suit is not maintainable.

3. The trial Court held that the plaintiff has to succeed in view of the decision in Mahaboob Bani Beevi v. Inspector, Central Excise H.O.R. II Kovilpatti, W.P.No.4145 of 1975 and therefore, decreed the suit for Rs. 7,839.20 with interest at 6 percent per annum from 25-84976 to date of realisation with proportionate costs. On the learned Judge in A.S.No.264 of 1978 upholding the decree, this Letter Patent appeal had been preferred.

4. Mr. T. Somasundaram, learned Counsel for defendants at the outset would point out that Rule 10-A having been struck down by this Court