2017 (4) TMI 884 - AT - Central Excise

Refund claim - rejection on the ground of limitation - case of appellant is that as such excess amount of ₹ 2,59,410/- is in the nature of Revenue deposit and no limitation is attracted - Held that - the amount excess paid in December, 2003 is in the nature of Revenue deposit. Further, there is no limitation for refund of Revenue deposit - the refund claim is not barred by limitation - refund allowed - decided in favor of appellant.

Summary

Issues:
Entitlement to refund of excess amount rejected on grounds of limitation.

Analysis:
The appellant, a manufacturer of Industrial Thinner and Organic Compound Solvent, appealed for a refund of ?2,59,410 which was rejected due to limitation. The appellant availed SSI exemption during 2002-03 and 2003-04, paying concessional rates on some clearances and normal rates on others. After an objection by the audit party, the appellant calculated a differential duty of ?6,68,250 and debited it in their Cenvat account. Upon Revenue's demand for interest, the appellant requested a calculation sheet, which revealed a lower differential duty of ?4,08,431. The interest on this amount was paid separately. The appellant then took suo-moto credit of the excess amount paid earlier and requested a refund, which was objected to by the Range Superintendent citing a tribunal ruling. The appellant complied, debiting ?2,59,410 and claimed a refund, which was rejected as time-barred by the Revenue. The appeal to the Commissioner (Appeals) was also dismissed.

The appellant argued that the excess amount was in the nature of a Revenue deposit and not subject to limitation. Even if considered as duty paid, the claim was made within 12 months of receiving the calculation sheet from the Department. It was contended that limitation should start from when the right to claim crystallized. The Revenue relied on the impugned order.

The Tribunal held that the excess amount paid in December 2003 was a Revenue deposit, not subject to limitation for refund. Therefore, the refund claim of ?2,59,410 was not time-barred. The Adjudicating Authority was directed to grant the refund with interest as per rules, starting three months from the claim date of 20/07/2006. Consequently, the appeal was allowed.