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Issues Involved:
1. Authority of the Assistant Collector of Central Excise to consider a claim for refund of excess excise duty paid by mistake of law outside the purview of Section 11-B of the Central Excises and Salt Act, 1944. 2. Entitlement to claim a refund of excess excise duty paid by mistake of law from the Union of India, even if such a claim falls outside the scope of Section 11-B of the Central Excises and Salt Act, 1944. Issue-Wise Detailed Analysis: 1. Authority of the Assistant Collector of Central Excise: The primary issue was whether the Assistant Collector of Central Excise has the authority to consider a refund claim for excess excise duty paid by mistake of law if it falls outside the purview of Section 11-B of the Central Excises and Salt Act, 1944. The facts revealed that the respondent paid excise duty including freight and transit insurance charges, which was later ruled by the Supreme Court in Union of India v. Bombay Tyre International Limited as not forming part of the assessable value. The respondent sought a refund for the excess duty paid, part of which was within the six-month period stipulated by Section 11-B and part of which was outside this period. The Assistant Collector granted the refund for the period within six months but issued a show cause notice for the rest, which was outside the six-month window. The Assistant Collector ultimately rejected the refund claim for the period beyond six months, citing lack of authority under Section 11-B, which was upheld by the learned Single Judge. The court held that the Assistant Collector's power is derived from and circumscribed by Section 11-B, which mandates that a refund claim must be made within six months from the relevant date. Sub-section (4) of Section 11-B further clarifies that no claim for refund of duty of excise shall be entertained except as provided under the Act. Therefore, the Assistant Collector cannot consider a refund claim outside this period. This position aligns with the Supreme Court decisions in Burmah Construction Company v. State of Orissa and D.R. Mills v. Commissioner of Civil Supplies, reinforcing that statutory authorities cannot grant refunds beyond the statutory period. 2. Entitlement to Claim Refund from Union of India: The second issue was whether a person can claim a refund of excess excise duty paid by mistake of law from the Union of India, even if such a claim does not fall within Section 11-B. The court observed that the right to claim a refund of tax or duty paid without authority of law stems from Article 265 of the Constitution of India, which states that no tax shall be levied or collected except by authority of law, and Section 72 of the Indian Contract Act, 1872, which mandates repayment of money paid by mistake. The court noted that if a person realizes that an amount was collected or paid without authority of law, they can demand a refund from the Government based on Section 72. If the Government fails to refund, the individual can file a civil suit or a writ petition under Article 226 of the Constitution. This principle was supported by the Supreme Court in H.M.M. Limited v. Bangalore City Corporation, which held that realization of tax without authority of law is bad and must be refunded. Therefore, the respondent was entitled to make an application before the Central Government for a refund of the excess duty paid, even though the application was initially made to the Assistant Collector. The court directed the Government of India to consider and dispose of the application within four months, taking into account Article 265 and Section 72. Conclusion: (i) The writ appeal was partly allowed. (ii) The order directing the Assistant Collector to consider the refund application without reference to the limitation period under Section 11-B was set aside. (iii) The direction to the Union of India to dispose of the refund application without reference to Section 11-B's limitation period was confirmed. (iv) The Government of India was directed to consider and dispose of the application within four months, considering Article 265 and Section 72.
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