2007 (4) TMI 496 - AT - Central Excise

Summary

Issues involved: Appeal against refund claim allowed by Commissioner (Appeals) u/s 11B - Application of effective rate of duty for vehicles registered as taxis - Time limit for claiming refund.

Refund Claim Allowed by Commissioner (Appeals):
The appeals were filed by the Revenue against the order passed by the Commissioner (Appeals) allowing the refund claim in favor of the respondents assessees. The vehicles were cleared at the effective rate, later registered as taxis by customers. The excess duty paid over the taxi rate was claimed as refunds. The Commissioner (Appeals) set aside the original orders and allowed the refunds, extending the time limit for claiming the refund under Section 11B from 12-5-2000. The vehicles were cleared on 5-10-2000 and 16-2-2001, and the refund was upheld based on this extension. The Commissioner (Appeals) held that duty cannot be collected more than the effective rate, and must be refunded when vehicles are registered as taxis, irrespective of the 6-month time limit mentioned in the notification. The order sanctioning the refund as per Section 11B was found to be without error, leading to the dismissal of Revenue appeals for lack of merits.

Application of Effective Rate of Duty for Vehicles Registered as Taxis:
The issue revolved around the application of the effective rate of duty for vehicles registered as taxis. The vehicles were initially cleared at the effective rate, and upon being registered as taxis, the duty applicable for taxis was sought to be applied. The excess duty paid over the taxi rate was claimed as refunds by the respondents assessees. The Commissioner (Appeals) upheld the refund, emphasizing that duty collected beyond the effective rate for vehicles registered as taxis must be refunded, regardless of the time limit specified in the notification. The application of Section 11B to extend the time limit for claiming the refund was crucial in this context.

Time Limit for Claiming Refund:
The time limit for claiming the refund was a significant aspect of the case. Despite the notification stipulating a 6-month period for filing refunds, the Commissioner (Appeals) extended this limit u/s 11B from 12-5-2000. The vehicles in question were cleared on specific dates, and the refund was allowed based on this extended time frame. The Commissioner (Appeals) justified the extension by emphasizing that duty collected above the effective rate for vehicles registered as taxis must be refunded, irrespective of the time limit mentioned in the notification. This interpretation played a crucial role in upholding the refund claim in favor of the respondents assessees.