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2021 (2) TMI 974 - HC - Central ExciseRefund claim - Period of limitation - Relevant Date - Finalization of provisional assessment - It is contended that, the time limit of one year to claim refund will apply from the date of finalization of order of assessment by the Assistant Commissioner of Central Excise. Therefore, the Tribunal erred in considering the finalization of prices between the appellant and the oil companies as the relevant date for claiming refund as per Section 11B of the Act - Whether CESTAT having considered the assessment as provisional, has erred in equating the date of finalization of price by customers to finalization of assessment? - HELD THAT - Admittedly, the application for refund made by the appellant on 24.08.2006 was rejected by the Assistant Commissioner by an order dated 24.05.2007. Being aggrieved by the order of the Assistant Commissioner, the appellant filed an appeal before the Commissioner of Central Excise (Appeals). It is not in dispute that the Commissioner of Central Excise (Appeals), by an order dated 24.12.2007, set aside the order passed by the Assistant Commissioner and allowed the appeal preferred by the appellant. Therefore, under the order dated 24.12.2007 passed by the Commissioner of Central Excise (Appeals), the appellant became entitled to the amount of refund. Thereafter, a fresh application was filed by the appellant on 11.02.2008. It is evident that where a duty becomes refundable as a consequence of judgment, decree, order or direction of Appellate Authority, Appellate Tribunal or any court, the date of such judgment, decree, order or direction would be relevant date for the purposes of Section 11B of the Act. Thus, the appellant was required to make an application for refund within a period of one year from the date of the order directing refund in favour of the appellant i.e. 24.12.2007 - The appellant admittedly has made an application on 11.02.2008. Thus, the application filed by the appellant was made within the period of limitation i.e. within a period of one year. However, the aforesaid aspect of the matter has not been considered by the Tribunal and the Tribunal has proceeded to examine the validity of the order in relation to the first application which has been made by the appellant. The Tribunal erred in considering the date of finalization of price between the appellant and their customers as relevant date in the light of Explanation B (ec) of Section 11 of the Act - question answered in the negative and in favour of the appellant - appeal allowed - decided in favor of appellant.
Issues:
1. Interpretation of Section 35G of the Central Excise Act, 1944 regarding refund claim. 2. Finalization of assessment under Rule 9B of the Central Excise Rules, 1944. 3. Relevance of the date of finalization of price between the Appellant and customers under Section 11B of the Central Excise Act, 1944. 4. Equating the date of finalization of price by customers to finalization of assessment. Analysis: 1. The appellant filed an appeal under Section 35G of the Central Excise Act against the Customs, Excise and Service Tax Appellate Tribunal's order. The substantial questions of law raised included whether the Tribunal was justified in allowing the appeal by the Department despite the refund order being implemented earlier. The period of dispute was from 01.07.1999 to 26.10.2000, involving the sale of LPG cylinders to oil companies at provisional prices. 2. The appellant sought a refund of excess duty paid, leading to a series of appeals and orders. The Commissioner of Central Excise (Appeals) set aside the Assistant Commissioner's order and allowed the refund claim. The appellant then filed a fresh refund claim, which was sanctioned by the Assistant Commissioner. However, the revenue appealed the Commissioner's order, leading to the Tribunal's decision in 2016, which favored the revenue. 3. The appellant argued that the Tribunal erred in considering the finalization of prices with oil companies as the relevant date for claiming a refund, contrary to Rule 9B(5) of the Act. The appellant contended that the application for refund made within one year of the Commissioner's order was within the limitation period, as per Section 11B of the Act. 4. The respondent argued that the application for refund was time-barred, citing the finalization of prices with oil companies in 2001. The Tribunal's decision was based on the premise that the assessments were deemed provisional until finalization, thus rejecting the appellant's claim as barred by limitation. 5. The Court analyzed the relevant provisions of Section 11B of the Act and concluded that the appellant's application for refund, made within one year of the Commissioner's order, was within the limitation period. The Tribunal erred in considering the date of finalization of prices with customers as the relevant date for refund claims, contrary to Explanation B(ec) of Section 11. 6. Consequently, the Court quashed the Tribunal's order, ruling in favor of the appellant on the interpretation of relevant dates for refund claims. The judgment emphasized the importance of the date of the order directing refund as the relevant date for refund applications, ensuring compliance with statutory provisions.
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