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Issues:
Appeal against order allowing Writ Petitions for refund of excise duty paid mistakenly, Application made beyond Rule 11 limitation period, Enforcement of Circular by Central Board of Excise and Customs, Dismissal of writ petitions due to delay and laches. Analysis: 1. The appeal was filed against the order of the learned Single Judge, who allowed the Writ Petitions presented by the respondent company seeking a refund of excise duty paid mistakenly. The respondent, a manufacturer of copper and copper alloy castings, had paid excise duty from 1-3-1975 to 26-12-1980, amounting to 3,64,961/-. The company later discovered an exemption notification issued by the Central Government on 12-4-1979, exempting copper and copper alloy castings from excise duty. The respondent applied for a refund on 27-9-1980 and 29-12-1980, which were rejected on 31-8-1984, leading to the filing of writ petitions on 29-10-1984. 2. The main contention raised was the application being made beyond the six-month limitation period prescribed under Rule 11 of the Central Excise Rules. However, the learned Judge held that since the application was made within three years from the date the mistake was discovered, the refund should be granted. The appellants argued that the Circular issued by the Central Board of Excise and Customs, allowing refunds within three years, was unenforceable as it contradicted Rule 11. Despite acknowledging the validity of this argument, the Court upheld the Single Judge's order for refund. 3. The Court emphasized that the respondent, unaware of the exemption notification, paid excise duty until the discovery of the exemption on 12-4-1979. Even though the Circular's enforceability was questioned, the Court asserted its power under Article 226 to mandate the refund of erroneously paid taxes or duties. The appellants contended that the delay in filing the writ petitions should lead to their dismissal, citing the expiration of the limitation period for filing a suit. 4. The Court rejected the argument of delay and laches by the respondent, noting that the Circular misled them into applying for refunds within three years from discovering the mistake. The respondent's belief in the Circular's validity justified the delay in filing suits instead of refund applications. The Court held that the delay was due to the conduct of the appellants, who rejected the refund applications after keeping them for over three years. 5. Consequently, the Court found no grounds to interfere with the Single Judge's order and upheld it, dismissing the appeal. The decision was based on the respondent's justified reliance on the Circular, leading to the delay in filing the writ petitions, which was attributed to the appellants' actions.
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