2015 (11) TMI 1599 - AT - Central Excise

Refund claim for refund of duty paid on goods cleared for in-house testing for the period 1998 onwards - Held that - In the monthly returns the respondents have indicated the duty payment made by them on account of testing of tyres and tubes in the test area (of their factory) in each month and from this it can be inferred that no documents have been issued for clearance of such tyres. That therefore testing has been carried out within the factory premises only. There is no allegation that respondents made clearances without payment of duty for testing. In the impugned order the Commissioner (Appeals) has allowed only the amount which is not barred by limitation. In such score taking into consideration the facts evidence and submissions made we are of the view that there is no infirmity in the order passed by the Commissioner (Appeals).

Summary

Issues:
1. Challenge to refund claim partly allowed by the impugned order.
2. Time-barred claim under Section 11B and lack of sufficient documents for duty payment.
3. Dispute regarding in-house testing of pneumatic tyres and duty payment.
4. Appeal against the grant of refund by the Commissioner (Appeals).

Analysis:

1. The appeal was filed by the Revenue challenging the impugned order that partially allowed the refund claim made by the respondents, who are manufacturers of pneumatic tyres and inner tubes. The refund claim was for duty paid on goods cleared for in-house testing from 1998 onwards. The Revenue contended that the claim was time-barred under Section 11B and lacked sufficient documentation to prove duty payment.

2. The dispute centered around whether the tyres underwent in-house testing or were taken outside the factory premises for testing, which would make the respondents liable to pay duty. The Commissioner (Appeals) considered the necessity of testing for goods to be certified as marketable and conforming to quality standards. It was noted that the respondents indicated duty payments for testing in their monthly returns, implying that testing was conducted within the factory premises without clearances without duty payment.

3. The Commissioner (Appeals) allowed a refund amount that was not barred by limitation, considering the evidence and submissions made. The Tribunal found no fault in the Commissioner's decision, as it was based on the facts presented and the lack of evidence suggesting duty evasion or improper clearances for testing purposes. Therefore, the Tribunal upheld the order of the Commissioner (Appeals) and dismissed the Revenue's appeal.

4. The judgment, pronounced in open court, concluded that there was no infirmity in the Commissioner's decision to grant the refund to the respondents. The dismissal of the Revenue's appeal affirmed the validity of the refund allowed by the Commissioner (Appeals) based on the evidence and compliance with duty payment requirements for in-house testing of pneumatic tyres and inner tubes.