1985 (4) TMI 299 - AT - Central Excise

Summary

Issues:
1. Interpretation of Rule 11 of the Central Excise Rules regarding the period of limitation for claiming refund.
2. Application of the provisions of old Rule 11 versus new Rule 11 in the context of refund claims.
3. Vested rights of the assessee in claiming refund of duty paid under different rules.

Analysis:
The case involved M/s. Nagarjuna Steels Limited seeking a refund of duty paid during specific periods. The dispute arose when the Assistant Collector and the Appellate Collector restricted the refund to a period of six months before the date of the refund application, in accordance with Rule 11 of the Central Excise Rules. The appellants argued that they were entitled to full relief under Notification No. 198/76, dated 16-7-1978, despite the amendment to Rule 11 limiting the refund period to six months before the application date.

The Tribunal considered the working instructions and the scheme under Notification No. 198/76. It was established that the appellants could claim relief from the date of their first clearance, which was in June 1977, and were not required to wait until the end of the financial year to apply for relief. The key contention revolved around the application of Rule 11 before and after the amendment on 6-8-1977. The appellants argued that the old Rule 11 should apply to duty paid before 6-8-1977, allowing a one-year period for refund claims, while the new Rule 11 should apply to duty paid after this date, limiting the refund period to six months.

The Tribunal distinguished its previous decision in the Atma Steels case, emphasizing that the issue of claims made before and after 6-8-1977 was not addressed in that judgment. Instead, the Tribunal relied on the Bombay High Court's decision, which upheld the assessee's vested right to claim a refund once duty was paid, regardless of the rule amendments. Consequently, the Tribunal held that the appellants could claim a refund under the old Rule 11 for duty paid before 6-8-1977 within one year of payment and under the new Rule 11 for duty paid after this date within a six-month period.

In conclusion, the Tribunal allowed the appeal partially, modifying the lower authorities' orders to grant the appellants a further refund for duty paid between 8-6-1977 to 6-8-1977, in addition to the relief already granted. The appeal was dismissed in other aspects, affirming the restricted refund period for duty paid after 6-8-1977 in line with the new Rule 11 provisions.