1985 (7) TMI 110 - HC - Central Excise

Summary

Issues:
Challenge to orders refusing excise duty refund under Article 226 of the Constitution of India.
Entitlement to refund of excise duty paid on iron and steel products.
Interpretation of trade notice dated 22nd June, 1967.
Calculation of time limit for refund application under Rule 11 of the Central Excise Rules, 1944.

Analysis:
The petitioner, a partnership firm in the iron and steel manufacturing business, contested orders dated 3rd May, 1968, 8th January, 1969, and 27th July, 1972, denying the refund of excise duty paid on flat steel products. The firm argued that the products should be classified as 'bars' per the Indian Customs Tariff, exempting them from differential duty. The duty was paid under protest, and a refund application was made after a trade notice clarified the classification on 22nd June, 1967.

During specific periods, the firm paid differential duty on the products, seeking refunds for some but facing rejection due to being allegedly time-barred. The central issue was whether the firm was entitled to a refund and if the trade notice could be applied. The petitioner contended that the three-month time limit for refund applications should start from the date of the trade notice, justifying their application timing.

Both appellate and revisional authorities rejected the refund applications as untimely. The court emphasized that the government must only levy legally payable duties and not withhold legitimate claims on technical grounds. Considering the trade notice's issuance on 22nd June, 1967, the court deemed the refund applications of 26th August, 1967, within the time limit set by Rule 11 of the Central Excise Rules, 1944. The court ruled in favor of the petitioner, granting a refund of Rs. 25,689.74 for duties paid between March 1966 to February 1967 and 3rd May 1967 to 8th May 1967, without costs.