2020 (10) TMI 862 - AT - Central Excise

Refund in terms of N/N. 33/99-CE, dated 08.07.1999 - denial only on the ground that the claim was not filed within a reasonable time - other substantive requirement of expansion in the installed capacity has been complied with - HELD THAT - The issue came up for consideration before the Tribunal in the case of Vernerpur Tea Estate vs. CCE, Shillong 2016 (4) TMI 17 - CESTAT KOLKATA which was decided against the assessee on the ground of limitation since refund claim was filed after a period of 6 years - the decision of the Hon ble Gauhati High Court in the case of Vernerpur Tea Estate, being directly on the point, has to be respectfully followed in the instant case inasmuch as the basic criterion of increase in the installed capacity has been duly fulfilled by the appellant and therefore, there is no reason to deny the refund. Appeal allowed - decided in favor of appellant.

Summary

Issues:
- Denial of refund claim based on the ground of limitation
- Interpretation of Notification No. 33/99-CE for refund eligibility

Analysis:
1. The appellant, engaged in tea manufacturing, filed appeals for refund under Notification No. 33/99-CE, which were denied due to delayed filing. The appellant met the condition of substantial capacity expansion, but authorities cited a Punjab & Haryana High Court decision for denial based on untimely claim submission.

2. The appellant's advocate referred to a Gauhati High Court ruling in Vernerpur Tea Estate case, emphasizing that unless a time limit is specified in the notification, refunds cannot be refused solely due to delay. Another Tribunal decision in Doolahat Tea Estate case supported this stance, granting refunds when conditions were met.

3. The Revenue's representative supported the lower authorities' decision, arguing against the merit of the appeal. The Tribunal reviewed the records and focused on determining whether a refund could be denied solely on the basis of time limitation, given the compliance with capacity expansion requirements.

4. The Tribunal found a previous case where a similar issue was decided against the assessee due to a delay of six years in filing the refund claim. However, the Gauhati High Court overturned this decision, emphasizing that once eligibility for exemptions and refunds is proven, delay should not unjustly deny benefits.

5. The Tribunal distinguished the Punjab & Haryana High Court decision cited by the Revenue, stating that the facts differed from the present case. Following the Gauhati High Court's ruling in Vernerpur Tea Estate case, the Tribunal decided to allow the appeals, as the appellant had fulfilled the essential criterion of capacity increase, warranting the refund.

6. Ultimately, the Tribunal set aside the lower authorities' orders, allowing the appeals with consequential relief, in line with the Gauhati High Court's interpretation of Notification No. 33/99-CE. The judgment emphasized that procedural delays should not hinder substantive benefits available to the assessee, especially when conditions for eligibility are met.