1998 (7) TMI 691 - HC - Central Excise

Summary

Issues:
1. Refund of excise duty paid under mistake of law.
2. Refund of excise duty based on a judgment of the Customs, Excise Gold Control Appellate Tribunal.
3. Applicability of Section 11B of the Central Excises and Salt Act for refund claims.
4. Time limit for filing refund applications under Section 11B.

Issue 1: Refund of excise duty paid under mistake of law
In the present case, the Kerala State Electricity Board sought a direction for the refund of excise duty paid under a mistake of law. The Collector of Central Excise (Appeals) rejected their applications for refund, leading to the filing of Original Petitions challenging the orders and seeking the return of the excise duty amount. The petitioners claimed that the excise duty was paid under a mistake of law, emphasizing the need for a refund based on this ground.

Issue 2: Refund of excise duty based on a judgment of the Customs, Excise Gold Control Appellate Tribunal
The petitioners also sought a refund of excise duty based on a judgment of the Customs, Excise Gold Control Appellate Tribunal, which held that the petitioners were not manufacturers. Subsequently, the petitioners applied for a refund of the excise duty paid, amounting to a significant sum. The appeal against the Tribunal's order filed by the Collector of Central Excise was dismissed by the Supreme Court, reinforcing the petitioners' claim for a refund based on the Tribunal's judgment.

Issue 3: Applicability of Section 11B of the Central Excises and Salt Act for refund claims
The judgment referred to a decision by a Constitution Bench of the Supreme Court in Mafatlal Industries Ltd. v. Union of India, which clarified the procedure for seeking a refund under the Central Excises and Salt Act. The Bench highlighted that claims for refund, except those arising from the declaration of unconstitutionality, must be preferred and adjudicated under the provisions of the respective enactments. This necessitated the petitioners to make an application under Section 11B of the Act for seeking a refund, as the law declared by the Supreme Court governed all pending matters, including refund claims.

Issue 4: Time limit for filing refund applications under Section 11B
The judgment emphasized the importance of adhering to the time limit prescribed by the Supreme Court for filing refund applications under Section 11B of the Central Excises and Salt Act. As the petitioners failed to make such an application within the specified period, the court noted that the Original Petitions had to be disposed of. The petitioners were advised to seek an extension of time to file their refund application before the Supreme Court, without prejudice to their right to seek appropriate relief.