K.L. Rekhi, Member (T)

1. The issues involved in these two appeals are inter-connected and they relate to the same appellants. We, therefore, make this combined order to dispose of both of them.

2. The facts, which are not in dispute, in brief are as follows :-

The appellants manufacture wire ropes. Central Excise duty on this item was introduced w.e.f. 1.3.1973 on ad valorem basis. The appellants did not have a regular price list as such of their goods. They sold their wire ropes on contract basis. They had 3 types of sales:-

(i) Sale to D.G.S. D./Government departments on rate contract basis;

(ii) Sale to industrial buyers/dealers on individual contract basis. Each contract was filed as a price list for approval of the central excise authorities; and

(iii) Stock transfer to other depots located at various places in India. From these depots, the goods were sold to general buyers on contract basis.

The dispute is on the last category to sales only in both the appeals. About 60% of the goods were sold ex-factory; the remaining 40% were removed to the depots for eventual sale therefrom.

3. After actual sale of the goods from their depots, the appellants submitted re-conciliation statements to the authorities. Wherever the authorities found that the actual sale prices were higher than the DGSD rate contract prices initially adopted, they issued demands for differential duty in form DD-2. In this manner, 21 demands were issued, beginning on 10.4.1974. The last demand was issued on 31.6.77. In all, the 21 demands totalled Rs. 7,63,775.14. The demands covered the period from March 1973 to March, 1976. The appellants paid these demands without demur. According to the understanding they had, they felt that they were also entitled to refund wherever the actual sale prices ex-depots were lower than the rate contract prices initially adopted. So, they lodged 35 refund claims, beginning on 24.3.1976 and ending on 27.9.1977. These refund claims cover the period from April 1973 to June 1977 and totalled Rs. 2,28,012.21. The Assistant Collector held that the assessments made in the appellants' factory were final and not provisional, and since the refund claims had been made after the expiry of the time limit laid down in Rule 11, he rejected them as time barred. In appeal, the Appellate Collector rejected the refund claims on merits holding that when the sale price at the factory gate was ascertainable, ex-depot sale prices were irrelevant. The appellants found themselves in a peculiar position in which they had paid the differential duties amounting to Rs. 7.63 lakhs in the case of ex-depot sales at higher prices but in which their refund claims for Rs. 2.28 lakhs stood rejected in the case of ex-depot sales at lower prices. They then asked for refund on 24.10.78 of the differential duties of Rs. 7,63,775.14 which they had earlier paid. The Assistant Collector rejected this claim holding that the appellants had accepted the price approval, that the price approval was not provisional and that the refund claim was time barred under Rule 11. The Appellate Collector up-held the rejection on the ground this time that stock transfer from the factory did not involve any sale and the ex-depot sale price was the correct assessable value. The appellants are now in appeal before us against the two sets of lower orders. Their prayer in the first appeal as pressed before us is that the assessments were provisional- and not final and hence their 35 refund claims amounting to Rs. 2,28,012.21 were not time barred. In the second appeal, their plea as pressed before us is that all the 21 DD-2 demands for differential duties amounting to Rs. 7,63,775.14 were time barred and had been issued straightaway without a show cause notice or adjudication and hence were void ab initio, notwithstanding the fact that the appellants had paid them. They plead that these demands could be sustained only in terms of finalisation of provisional assessments under Rule 9B, that