1983 (2) TMI 318 - AT - Central Excise

Summary

Issues:
1. Time-bar under Rule 11 read with second proviso to sub-rule (10) of Rule 173PP of the Central Excise Rules, 1944.
2. Specificity of claim for set-off in the classification list.
3. Entitlement to set-off under notification No. 178/77-C.E.

Analysis:

1. The Appellate Tribunal considered the issue of time-bar regarding a refund claim for set-off under exemption Notification No. 178/77-C.E. The Appellate Collector allowed the refund claim for the period after 30-6-1978 but rejected the claim for the earlier period as time-barred. The appellants argued that they had initially made the claim in their classification list submitted on 8-3-1978, well before the time limit. The Tribunal found that the Assistant Collector had not approved the classification list promptly, and when he did, he struck off the entry related to the set-off claim without providing reasons. The appellants relied on a Delhi High Court judgment to support their contention that the claim could not be rejected based on time-bar. The Tribunal agreed with the appellants, emphasizing that the claim was made in time, and the rejection on the basis of time-bar was not justified.

2. The Department's representative contended that the appellants' claim in the classification list was not specific enough, lacking essential data to quantify the set-off amount. The Tribunal examined the classification list submitted by the appellants on 8-3-1978, where the claim for set-off was mentioned without specifying the amount. The Tribunal noted that the end-products involved were custom-built, making it challenging to pre-determine the exact set-off amount per unit. The Tribunal held that the claim was sufficiently made in the classification list, and the Assistant Collector should have requested additional data if needed, rather than rejecting the claim without justification. Therefore, the Tribunal rejected the Department's argument regarding the specificity of the claim.

3. The Tribunal raised doubts during the proceedings regarding the appellants' entitlement to set-off under notification No. 178/77-C.E. The notification allowed set-off for duty paid on inputs falling under Item 68 of the Central Excise Tariff. However, the inputs described by the appellants in their classification list seemed to fall under different tariff items. To clarify this issue, the Tribunal decided to remand the matter back to the Appellate Collector for further examination. The Tribunal directed that the refund for the allowed period should only be granted after confirming that the inputs were classifiable under Item 68-CET. The Tribunal modified the Order-in-Appeal to reflect this decision, ensuring that the appellants' entitlement to set-off was verified before granting the refund.

In conclusion, the Appellate Tribunal addressed the issues of time-bar, specificity of the claim, and entitlement to set-off under the relevant notification in a detailed manner, ultimately remanding the matter back to the Appellate Collector for further examination regarding the classification of inputs under Item 68-CET before granting the refund.