1995 (3) TMI 424 - AT - Central Excise

Summary

Issues:
- Appeal filed by Revenue against order of Collector of Central Excise (Appeals) regarding duty on Pharma Yeast.
- Classification of Pharma Yeast under different tariff headings.
- Contention on the effect of subsequent approval of classification list.
- Whether duty paid under an approved classification list can be claimed as a refund.
- Application of the decision in Herschel Rubber (Pvt.) Ltd. v. Collector of Central Excise.

Analysis:
1. The appeal was filed by the Revenue against the order of the Collector of Central Excise (Appeals) concerning the duty on Pharma Yeast. The appellant filed classification lists claiming Pharma Yeast as non-excisable, which were approved at a 12% ad valorem rate. A show cause notice was issued for duty on Pharma Yeast cleared during a specific period. The assessee paid duty under protest and later sought a refund based on a different classification. The Assistant Collector and the Collector (Appeals) approved the classification under a different heading, leading to a refund order.

2. The Revenue contended that the duty paid under an approved classification list cannot be claimed as a refund, and subsequent approvals have only prospective effects. They argued that Pharma Yeast should be classified under a different heading. The Revenue highlighted a similar case where the approval under a specific heading was challenged. The Revenue sought to set aside the refund order based on these grounds.

3. The Tribunal referred to the decision in Herschel Rubber (Pvt.) Ltd. v. Collector of Central Excise, emphasizing that a classification determination under a classification list cannot be reviewed by the same authority once approved. The Tribunal held that an assessee must challenge a classification directly through an appeal and not indirectly through a refund claim. Based on this precedent, the Tribunal found that the refund order directing the Assistant Collector to refund the duty was unsustainable.

4. Ultimately, the Tribunal set aside the impugned order directing the refund of duty on Pharma Yeast. The decision was based on the fact that the approved classification list classified the disputed product under a specific heading, which was not challenged in appeal. Therefore, the Tribunal held that the refund claim was not sustainable under the established legal principles.

By analyzing the issues raised in the appeal and considering the legal precedent cited, the Tribunal concluded that the refund order was not valid, and the appeal filed by the Revenue was allowed.