2017 (7) TMI 1030 - AT - Central Excise

Refund claim - rejection on the ground that the appellants have filed refund claim after one year from the date of shipment (date of export) therefore, in terms of Section 11B the refund is time bar as the same were filed after one year from the date of export - Held that - the fact is not under dispute that all the refund claims were filed within one year from the end of the quarter, for which the refund pertains - Rule 5 read with N/N. 5/2006 thus provides that refund should be filed on quarterly basis only after completion of the particular quarter. Therefore, the refund cannot be filed before completion of the quarter - in the facts of the present case, since all the refund were filed within one year from the date immediately after completion of a quarter, even as per the provisions of 11B the refund claims are within time limit. For this reason the refund is not liable to be rejected on time bar - appeal dismissed - decided against Revenue.

Summary

Issues:
1. Interpretation of time limitation for filing refund claims under Rule 5 and notification issued thereunder.
2. Applicability of Section 11B in the context of refund claims under Rule 5.
3. Relevance of the Tribunal's decision in GTN Engineering case.
4. Impact of Madras High Court's decision on the Tribunal's ruling.
5. Determination of the correct starting point for the one-year period for filing refund claims.

Analysis:
1. The case involved a dispute regarding the time limit for filing refund claims under Rule 5 and the corresponding notification. The appellants had filed refund claims against the export of goods within one year from the end of each quarter, as required by the rules.

2. The adjudicating authority rejected part of the claim, citing Section 11B, which states that refunds must be filed within one year from the date of export. However, the Commissioner (Appeals) allowed the appeal, relying on the Tribunal's decision in GTN Engineering case, which held that Section 11B does not govern refund claims under Rule 5.

3. The revenue, represented by the Assistant Commissioner, argued that the Commissioner (Appeals) solely relied on the Tribunal's decision in GTN Engineering, which was later reversed by the Madras High Court in a similar case involving the same party. Therefore, the revenue contended that the Commissioner's order was not sustainable.

4. The respondent's counsel argued that even though the Tribunal's decision in GTN Engineering was overturned by the Madras High Court, the refund claims in the present case were filed within the prescribed time limit from the end of the quarter, as specified in the notification.

5. The Member (Judicial) analyzed the submissions and disagreed with the Commissioner's finding that Section 11B did not apply to refund claims under Rule 5. However, it was established that all refund claims were filed within one year from the end of the quarter, in accordance with the rules. The correct starting point for the one-year period was determined to be from the date immediately after a particular quarter, not from the date of export.

6. Referring to a previous case involving Ocean Connect India Pvt. Ltd., the Member (Judicial) emphasized that the one-year period for filing refund claims under Rule 5 should be reckoned from the end of the quarter, as supported by legal precedent. Consequently, the appeals of the revenue were dismissed, affirming that the refund claims were within the time limit and not subject to rejection on the grounds of being time-barred.