1984 (11) TMI 70 - HC - Central Excise

Summary

Issues:
1. Application for refund of excise duty beyond the period of limitation.
2. Interpretation of the notification exempting excise duty on certain products.
3. Consideration of delay in filing the writ petition for refund under Article 226.

Analysis:
The judgment dealt with a case where the petitioner sought a refund of excise duty paid mistakenly beyond the limitation period. The petitioner inquired about the liability to pay excise duty on products manufactured from steel ingots, believing them to be exempt under a specific notification. The Department initially informed the petitioner to pay excise duty, but later, the Allahabad High Court held that such products were not liable for excise duty. The petitioner realized the mistake after making payments from August 1971 to December 1971. The Department rejected the refund application citing limitation under Rule 11 and Rule 173J of the Central Excise Rules.

The petitioner pursued the matter through appeals and revisions, ultimately moving the High Court under Article 226 for relief. The Court noted that the Government accepted the interpretation of the Allahabad High Court regarding the exemption from excise duty. The respondent contended that the application for refund was belated, but the Court emphasized that the petitioner diligently sought refund through departmental channels before approaching the Court. Citing the precedent in D. Cawasji and Co. v. State of Mysore, the Court highlighted the three-year limit from the date of knowledge of the mistake for filing a writ petition for recovery of money paid under a mistake of law.

The Court exercised discretion considering the circumstances and the petitioner's efforts to rectify the error. It directed the respondents to refund the amount paid mistakenly by the petitioner. The Court allowed a six-month period for the refund or adjustment against future duties. The judgment underscored the importance of judicial discretion in entertaining applications for relief, especially when delays are explained and efforts for redressal are evident.