2011 (5) TMI 783 - AT - Central Excise

Refund time bar - refund claim for the period from April, 1987 to Feb, 1994 was filed in November 1996 - Commissioner (Appeals) while holding that the refund is admissible on merit as the same is not time barred for the reason that duty has been paid by M/s. ICL under protest and credited the sanctioned refund amount to the Consumer Welfare Fund on the ground that will be bar of unjust enrichment - Held that the Commissioner (Appeals) findings that the refund claim filed by the appellant is not hit by time bar is not correct, the findings of the Commissioner (Appeals) on this point is set aside since the refund claim is time barred, Revenue s appeal is allowed, Cross Objection filed by the Revenue is also stands disposed of

Summary

Issues:
Classification and applicable rate of duty for conveyor belts, refund claim under Section 11B by M/s. SECL, time limitation for refund claim, applicability of unjust enrichment.

Classification and Applicable Rate of Duty:
The case involved a dispute regarding the classification and applicable rate of duty for conveyor belts purchased by M/s. SECL from M/s. ICL. The issue arose when duty was paid under protest by M/s. ICL, which was later recovered from M/s. SECL. The classification dispute was settled in favor of M/s. ICL by the Hon'ble Supreme Court. Subsequently, M/s. SECL filed a refund claim under Section 11B as the buyer of the goods who had not paid duty. The Asst. Commissioner rejected the refund claim, leading to an appeal by M/s. SECL.

Time Limitation for Refund Claim:
The main contention revolved around the time limitation for the refund claim filed by M/s. SECL. The Jt. CDR argued that the refund claim was time-barred, citing the Supreme Court's decision in the case of CCE Mumbai II v. Allied Photographics India Ltd. The Jt. CDR emphasized the distinction between the rights of a manufacturer and a buyer to claim a refund, asserting that the limitation period would apply even if duty had been paid under protest by the manufacturer. The Advocate for M/s. SECL relied on the case of National Winder vs. CCE Allahabad to support their position.

Applicability of Unjust Enrichment:
The issue of unjust enrichment was also raised, with the Commissioner (Appeals) holding that the refund was admissible on merit but credited the amount to the Consumer Welfare Fund to prevent unjust enrichment. However, the Tribunal set aside the Commissioner (Appeals) findings on this point as the refund claim was deemed time-barred based on the Supreme Court's decision and the Tribunal's previous ruling in the appellant's case. Consequently, the question of unjust enrichment became irrelevant to the final decision.

Conclusion:
Ultimately, the Tribunal allowed the Revenue's appeal, dismissing the appeal filed by M/s. SECL as the refund claim was considered time-barred. The Cross Objection filed by the Revenue was also disposed of in light of the judgment. The decision was based on the application of the limitation period under Section 11B and the distinction between the rights of a manufacturer and a buyer to claim a refund, as established by legal precedents.