2009 (12) TMI 801 - AT - Central Excise

Refund claim - time limitation - Section 11B of CEA, 1944 - price variation clause - Held that - for the purpose of assessing the goods provisionally there were provisions of Rule 7 of CER, 2004. It is on record that the assessee/appellant had not sought for provisional assessment of the goods under Rule 7. If that be so, because of existence of price variation clause the assessments cannot be considered as provisional - appeal dismissed - decided against appellant.

Summary

Issues:
Refund claim rejection based on time limitation under Section 11B of Central Excise Act, 1944.

Analysis:
The case involved a dispute regarding a refund claim of Central Excise duty amounting to Rs. 2,28,000/- filed by the appellants. The appellants supplied Elastic Rail clips to Southern Railway as per the terms of the purchase order, which included a price variation clause. The appellants claimed that they had erroneously calculated the price variation bills based on a higher rate of raw materials due to the price escalation clause, resulting in excess duty payment. The Assistant Commissioner partially confirmed a show cause notice rejecting the refund claim, and a portion of the amount was refunded. The appellant's appeal to the Commissioner (Appeals) was dismissed, leading to the current appeal.

The main issue before the Tribunal was whether the refund claim was time-barred under Section 11B of the Central Excise Act, 1944. The appellants argued that the existence of a price variation clause in the agreement with the railways made the assessments provisional, thus exempting them from the limitation period under Section 11B. However, it was noted that the appellants had not sought provisional assessment under Rule 7 of the Central Excise Rules, 2004. Referring to a previous decision, the Tribunal emphasized that the mere presence of a price variation clause in the contract did not automatically make the assessment provisional. The Tribunal cited rulings stating that to establish provisional clearances, there must be a specific request and compliance with the rules, which was lacking in this case. As the refund claim was filed beyond the one-year period stipulated in Section 11B, the Tribunal found no merit in the appeal and rejected it.

In conclusion, the Tribunal upheld the lower authorities' decision to reject the refund claim based on the time limitation under Section 11B of the Central Excise Act, 1944. The Tribunal relied on precedent to establish that the absence of a formal request for provisional assessment rendered the assessments non-provisional, thereby subjecting the refund claim to the statutory time limit. The appeal was dismissed, affirming the correctness and legality of the impugned order.