1973 (11) TMI 81 - HC - Central Excise

Summary

Issues:
Claim for recovery of excess Central Excise duty paid for purchase of furnace oil.
Entitlement to refund of excise duty paid in 1963.
Validity of claim against Union of India and Collector of Customs.
Compliance with Central Excise Rules for refund eligibility.
Amendment of plaint to claim relief against defendant No. 3.

Analysis:

The plaintiff, a company, filed a suit against Union of India and Collector of Customs for recovery of excess Central Excise duty paid for purchasing furnace oil. The plaintiff contended that it was entitled to purchase oil free of excise duty under a license but had paid sums of money as duty to the seller, defendant No. 3. The plaintiff sought a refund from defendants 1 and 2, who had collected the duty from defendant No. 3. The court noted that the plaintiff's claim for the amount paid in January 1964 was not valid as the license exemption had expired in 1963, making the plaintiff ineligible for a refund for purchases made in 1964.

Regarding the claim for the amount paid in December 1963, the court analyzed the provisions of the Central Excises and Salt Act and ruled that the plaintiff, not being a manufacturer or producer, had no direct obligation to pay excise duty to the Union of India. The court held that the plaintiff's claim for refund should be against defendant No. 3, the recipient of the duty, rather than against the Union of India or the Collector of Customs. The court emphasized that the plaintiff's failure to make a claim within the stipulated three-month period under Rule 11 of the Central Excise Rules further weakened the refund claim against defendant No. 1.

Moreover, the court highlighted the plaintiff's non-compliance with rules 192 to 194 of the Central Excise Rules, which required submission of monthly reports on excisable goods obtained under a concessional rate license. The court found that the plaintiff had not provided sufficient evidence of compliance with these rules, which were essential for claiming concessions and refunds. The court concluded that the plaintiff had no enforceable claim against defendants 1 and 2, emphasizing that any right for a refund would lie against defendant No. 3.

The court rejected the plaintiff's request to amend the plaint to claim relief against defendant No. 3, stating that such an amendment would alter the character of the suit. Ultimately, the court allowed the appeal by Union of India and Collector of Customs, setting aside the lower court's judgment and decree without awarding costs.