2017 (7) TMI 329 - AT - Central Excise

Refund claim - time limitation - whether the refund claim filed by the appellant, which was rejected as being filed beyond the period of limitation is correct or otherwise? - Held that - refund claim rejected only on the ground that the appellant had not filed requisite documents in furtherance to the letter on 04.06.2007. It is to be noticed that the gist of the letter dated 04.06.2007, only seeks some clarification as to whether the amount has been debited or otherwise and they have not submitted the cancelled invoices or the subsequent invoices. The said letter has not rejected the refund claims - time limit of refund claim has to be counted from the date of filing of the refund claim - the appeal is allowed and remitted back to the adjudicating authority to process the refund claim - appeal allowed by way of remand.

Summary

Issues:
- Consideration of a rejected refund claim filed beyond the period of limitation.

Analysis:
The appeal before the Appellate Tribunal CESTAT Hyderabad revolved around the rejection of a refund claim by the appellant, which was deemed to be filed beyond the period of limitation. The dispute stemmed from the appellant's submission of a refund claim in May 2007, subsequent to an earlier intimation to the department regarding an erroneous invoice issued in November 2006. The department requested additional details in June 2007, which the appellant claimed to not have received. Despite subsequent requests for refund in 2011 and 2013, the refund was denied by the Assistant Commissioner in December 2013, a decision upheld by the Commissioner (A) in March 2016.

The crux of the matter lay in the authorities' rejection of the refund claim due to the appellant's alleged failure to provide requisite documents following the department's letter in June 2007. However, the Tribunal noted that the letter did not explicitly reject the refund claims but sought clarification on specific details. Citing Section 11B, the Tribunal emphasized that the provision does not mandate the return of refund claims and requires adjudication by the authorities. The Tribunal referenced a Delhi High Court case to support its stance that rejecting a refund claim solely based on being filed beyond the limitation period is incorrect.

Further, the Tribunal highlighted a case involving Repro Ltd. where the rejection of claims based on limitation rather than merit was criticized. The Tribunal underscored that the time limit for a refund claim should be calculated from the initial filing date. Drawing on precedents from cases like Angiplast Pvt Ltd. and Super Spinning Mills Ltd., the Tribunal established the settled legal position that the time limit for a refund claim commences from the date of filing. Consequently, the Tribunal set aside the impugned order, allowed the appeal, and remitted the case back to the adjudicating authority for processing the refund claim.

In conclusion, the Tribunal's judgment clarified the incorrectness of rejecting a refund claim solely on the grounds of being filed beyond the limitation period. By emphasizing legal precedents and settled principles, the Tribunal reinstated the importance of considering the filing date as the starting point for the time limit on refund claims. The decision served as a reminder of the procedural fairness and adherence to legal principles in handling refund claims within the excise duty framework.