Per Justice U.L. Bhat :

The common appellant in these appeals, engaged in the manufacture of PVC Cables for supply to State Electricity Boards against specific contracts or purchase orders containing price variation clause, was filing price lists from time to time in Part II on the basis of the contract price and enclosing copies of the contracts along with the price lists. On the approval of the price lists, appellant was clearing goods on payment of duty appropriate to the approved price. The dispute in these appeals relates to the period from 1.3.1986 to 5.10.1986. Modvat scheme was introduced in the Central Excise Rules, 1944 with effect from 1.3.1986. With the introduction of the Modvat scheme, appellant started availing the benefit thereof, namely, taking credit of duty paid on specified inputs and utilising the credit for payment of duty on the finished products. Clearances were made during the disputed period on payment of duty on the approved value.

2. On becoming familiar with the implications of the Modvat scheme, it was felt that since the duty paid on the inputs was given credit of to the appellant, to that extent the cost of raw materials was reduced and, therefore, the reduction should be reflected in the cost of the final product by virtue of the price variation clause and after discussion with the appellant, price was reduced by an amount equal to the amount of Modvat credit availed on the relevant inputs. On the difference between the original price and the reduced price, appellant was issuing credit notes in favour of the buyer. Thus in effect and sub¬stance, in respect of the clearances made during the disputed period, the ruling price was not the approved price but the price reduced subsequently. It appears for the subsequent periods appellant filed revised price lists reflecting the reduced price and the same had been approved by the Department. In regard to the disputed period also, appellant filed revised price lists with retrospective effect. According to the learned counsel, appellant has not been informed of the action taken on the re¬vised price lists. Appellant preferred fifteen refund claims seeking refund of the proportionate duty on the amounts covered by the credit notes issued in favour of the buyer as representing the extent of the reduction in the price. Show cause notices were issued to the appellant indicating that duty was legally payable on the assessable value at the time and place of removal and, therefore, any subsequent reduction would have no consequence that price lists having been finally approved, no refund claim would lie and that refund claims were barred by limitation. Appellant resisted these averments in the show cause notices. However, Assistant Collector passed two sets of orders rejecting all the refund claims on the basis of reasons indicated in the show cause notices. Appellant filed appeals against seven orders which were heard together by the Collector (Appeals) who dis¬missed the same by a common order. Hence, the present appeals.

3. The lower authorities were clearly in error in holding that the final nature of the approval granted in the price lists was a bar to the filing of the price lists. That such a view is errone¬ous is seen from the decision of the High Court of Calcutta in ITC Ltd. and another vs. Union of India and others, 1988 (34) ELT 473 (Cal.HC) and several decisions of the Tribunal including the one in Industrial Cables (India) Ltd. vs. Collector of Central Excise, Bombay, 1996 (87) ELT 419 (T).

4. All the refund claims had been filed more than six months after the payment of duty on the various clearances. Therefore, they are prima facie barred under the provisions of Section 11B of the Central Excises Act, 1944. The appellant sought to get over the bar of limitation by contending before the lower author¬ities that in view of the price escalation clause in the con¬tracts, the approval granted in the price lists must be deemed to be provisional and c