2009 (12) TMI 651 - CGOVT - Central Excise

Revision application - Assistant Commissioner has rejected part of the refunds claims on the grounds that Notification No. 40/2001-C.E. (N.T.), dated 26-6-2001 does not cover the Kathmandu (Nepal) flights for rebate claim of duty Held that - as per the Notifications 46/94-C.E. (N.T.), they were not entitled for the rebate, Revision Application is rejected

Summary

Issues:
1. Refund claims of duty paid ATP (Aviation Turbine Fuel) supplied to aircraft on foreign runs.
2. Rejection of refund claims based on Notification No. 40/2001-C.E. (N.T.).
3. Clarifications provided by the Government of India Ministry of Petroleum & Natural Gas.
4. Coverage of Nepal/Bhutan under international agreements.
5. Rejection of refund claims without issuance of Show Cause Notices.
6. Admissibility of rebate of duty under Notification No. 46/94-C.E. (N.T.).
7. Applicability of administrative instructions predating relevant notifications.
8. Precedent set in a similar case by the Government.

Analysis:
The case involves refund claims by M/s. Indian Oil Corporation Ltd. for duty paid ATP supplied to aircraft on foreign runs. The Assistant Commissioner rejected part of the claims citing that Notification No. 40/2001-C.E. (N.T.) did not cover flights to Nepal for rebate claims. The appellants argued that administrative instructions and agreements with Nepal/Bhutan entitled them to the rebate. They also contested the rejection without issuance of Show Cause Notices. However, the Commissioner (Appeals) upheld the rejection, leading to the revision applications.

The Government considered the case and found that the rebate claim was filed under Notification No. 46/94-C.E. (N.T.), dated 22-9-1994, which did not cover Nepal. The executive instruction predating 1950 cited by the applicant was deemed inapplicable. The Government emphasized that notifications have legal sanctity and prevail over administrative instructions. A previous case involving Indian Oil Corporation Ltd. in Mumbai was cited where a similar rebate claim was held admissible under Notification No. 46/94-C.E. (N.T.) for flights to Kathmandu, Nepal.

Ultimately, the Government upheld the rejection of the refund claims, stating that the administrative instructions were not applicable in this case. The notifications had parliamentary approval and legal sanctity, overriding any contradictions with administrative instructions. The decision was consistent with a previous ruling in a similar case. The revision application was deemed devoid of merit and rejected accordingly.