2006 (10) TMI 330 - AT - Central Excise

Refund - Protest lodged subsequent to payment - Appeal to Appellate Tribunal - Merger - Non-applicability of

Summary

Issues involved:
Appeal against grant of refund, reversal of input credit, time-barred refund claims, procedure for payment of duty under protest, principle of merger, maintainability of Revenue appeal, substantial compliance with Rule 233B, entitlement to obtain refund.

Analysis:

1. Appeal against grant of refund:
The appeal was filed by the Revenue challenging the grant of refund of Rs. 4,88,480/- to the assessee by the lower appellate authority. The original authority rejected the refund claims, except for the amount reversed on 28-2-01, which was allowed in the appeal. The Tribunal further allowed refund in respect of three claims where the assessee had filed a letter of protest with the Department, albeit after payment. However, one claim was not allowed as no protest was lodged.

2. Reversal of input credit:
The case involved a dispute regarding the reversal of input credit on waste generated during the manufacture of Blended Yarn by the assessee. A previous Tribunal order had clarified that the assessee was not required to reverse input credit on clearance of waste. The assessee paid duty towards the credit related to the waste during certain years, and upon succeeding in their appeal, claimed a refund of the amounts paid.

3. Time-barred refund claims and procedure for payment of duty under protest:
The Revenue contended that the refund claim was time-barred as the protest was lodged with the Department a week after payment, contrary to the procedure prescribed under Rule 233B. The Tribunal, however, found substantial compliance with the procedure as the assessee had intimated the payment to the Department within a week of payment and obtained acknowledgment, allowing the refund claims.

4. Principle of merger and maintainability of Revenue appeal:
The Revenue argued that the impugned order had merged with a previous Tribunal order, making their appeal maintainable. However, the Tribunal held that the principle of merger did not apply in this case, citing judgments that supported the maintainability of the Revenue's appeal challenging a specific aspect of the order.

5. Substantial compliance with Rule 233B and entitlement to obtain refund:
The Tribunal emphasized that the assessee's compliance with the requirement of Rule 233B, by intimating the payment to the Department promptly and obtaining acknowledgment, was sufficient for their entitlement to obtain a refund. The Tribunal dismissed the Revenue's appeal, affirming the entitlement of the assessee to the refund amount.

In conclusion, the Tribunal upheld the grant of refund to the assessee, emphasizing substantial compliance with procedural requirements, rejecting the Revenue's arguments on time-barred claims and the principle of merger, and affirming the maintainability of the Revenue's appeal on specific grounds.