2008 (8) TMI 699 - AT - Central Excise

Summary

Issues:
1. Rejection of refund claim as time-barred due to non-compliance with Rule 233B.
2. Interpretation of whether the procedure under Rule 233B is mandatory or directory.
3. Applicability of protest endorsement on PLA for duty payment.

Analysis:
1. The appeal stemmed from the rejection of a refund claim amounting to Rs. 98,912 as time-barred in OIA No. 111/05 CE. The appellant contended that the duty was paid under protest and the term "protest" was endorsed in the PLA. However, the claim was dismissed citing non-compliance with Rule 233B. The Commissioner upheld the rejection, emphasizing the mandatory nature of following the procedure under Rule 233B for such claims.

2. The crux of the dispute revolved around whether Rule 233B is mandatory or merely directory. The appellant argued that the provisions under Rule 233B are not obligatory but merely directory. They asserted that as long as duty is paid under protest, the claims cannot be time-barred. Citing the precedent set by the Supreme Court in Ex. Engr., Workshop Divn., M.P. Electricity Board v. CCE, Raipur, it was contended that following the procedure under Rule 233B is not a prerequisite for a valid protest. On the contrary, the Departmental Representative (DR) contended that compliance with Rule 233B is essential, referencing the judgment in the case of Gujarat State Fertilizers & Chem. Ltd. v. CCE, Vadodara.

3. The Tribunal, after careful consideration, acknowledged that the appellants had indeed endorsed the term "protest" on the PLA and paid duty under protest. Relying on the precedent established by the Apex Court and various judgments, the Tribunal concluded that the procedure outlined in Rule 233B is merely directory and not mandatory. Notably, in the case of ICEM Eng. Co. (P) Ltd. v. CCE, a three-Member bench upheld the validity of a protest letter under Rule 233B. Consequently, the Tribunal ruled in favor of the appellant, setting aside the impugned order and allowing the appeal with consequential relief.

In conclusion, the judgment centered on the interpretation of Rule 233B, emphasizing the significance of endorsing a protest on the PLA for duty payment purposes. The Tribunal's decision clarified the non-mandatory nature of the procedure under Rule 233B and underscored the validity of a protest endorsement for safeguarding refund claims against being time-barred.