2005 (5) TMI 438 - AT - Central Excise

Summary

Issues involved:
Whether the refund claim of the respondents is time-barred or not.

Analysis:
The appeal before the Appellate Tribunal CESTAT, New Delhi was filed by the Revenue against the impugned order-in-appeal, focusing on the issue of the timeliness of the refund claim made by the respondents. The respondents, engaged in the manufacturing of Induction Furnaces and Induction Heating Equipment, had been accused of evading excise duty, leading to a raid at their factory premises. Following an investigation, it was revealed that they had evaded a specific duty amount, which they subsequently deposited in their PLA by instalments over a period. A show cause notice (SCN) was then served on them, and after adjudication, the Additional Commissioner confirmed a portion of the duty payment and dropped the rest of the demand in an order dated 6-6-2003. Subsequently, the respondents lodged a refund claim for the balance amount on 21-8-2003.

The crux of the matter revolved around the timeliness of the refund claim. The Revenue contended that the claim should have been made within one year from the date of deposit in the PLA. However, the Tribunal found this argument to be misconceived. It was highlighted that the respondents could not have legally claimed the refund until the SCN was adjudicated upon by the competent authority. The cause of action for the refund claim only arose upon the passing of the order by the Additional Commissioner on 6-6-2003, confirming the duty payment and dropping the demand. As the refund claim was lodged within a reasonable time from that date, the Tribunal upheld the validity of the impugned order, which deemed the refund claim to be within the permissible timeframe. Consequently, the appeal of the Revenue was dismissed, affirming the decision in favor of the respondents.

In conclusion, the Tribunal's analysis focused on the legal timeline for lodging the refund claim, considering the progression of events from the investigation to the adjudication of the SCN. By clarifying the point at which the respondents could legitimately claim the refund, the Tribunal determined that the claim was not time-barred and upheld the decision in favor of the respondents, dismissing the appeal of the Revenue.