1975 (7) TMI 145 - HC - Central Excise

Summary

Issues:
- Application for refund of excise duty
- Renewal of license and withdrawal of certificate
- Payment of duty by third parties
- Maintainability of the application for refund
- Indirect tax and entitlement to refund
- Limitation period for refund application
- Liability for payment of excise duty
- Renewal of license and right to claim refund

Analysis:
The judgment pertains to a Rule under Article 226 challenging the rejection of a revision application for refund of excise duty under the Central Excises and Salt Act, 1944. The petitioner held License No. 6 to purchase certain goods without duty for manufacturing Thinners, which expired on December 31, 1968, and was subsequently renewed for 1969. However, the Excise authorities withdrew Certificate No. C.T. 2 on January 10, 1969, leading to the petitioner paying duty to suppliers Indian Iron and Steel Ltd. and Hindustan Steel Ltd. The petitioner sought a refund post-renewal, which was rejected, prompting the Rule issuance.

The petitioner contended that despite not directly paying duty, the refund was justified post-renewal based on the Supreme Court's decision in Jasbhai Motibhai Desai v. Roshan Kumar Haji Bashir Ahmed. It was argued that as excise duty is an indirect tax, the petitioner, having paid indirectly, should be refunded. Additionally, the suppliers' no-objection letters supported the refund claim. Conversely, the Revenue argued against refund to the petitioner, citing non-realization of duty from them and the duty being paid by the suppliers.

The judgment emphasized that the duty was paid by the suppliers, making them eligible for a refund under Rule 11 within a year of payment. As the suppliers did not apply within the stipulated period, any current application would be time-barred. The duty, being part of the goods' price, was paid by the suppliers to the Excise authorities at the point of removal, absolving the petitioner of direct duty payment. The renewal of the license did not entitle the petitioner to claim a refund from the authorities, given the absence of excess duty payment by the suppliers.

Ultimately, the Rule was discharged, with no costs awarded. The judgment highlighted the lack of merit in the petitioner's claim due to the duty payment dynamics and the suppliers' failure to apply within the limitation period, underscoring the rejection of the refund application.