1991 (8) TMI 100 - HC - Central Excise

Summary

Issues:
1. Refusal of refund claim by Assistant Collector of Central Excise.
2. Failure to carry out the order of the Collector of Central Excise.
3. Disposal of writ petition by Justice Mrs. Pal not being implemented.
4. Argument regarding unlawful enrichment raised by the respondents.
5. Failure of the Assistant Collector to act in accordance with the court's directive.

Analysis:
1. The petitioners, manufacturers of Super Enamelled Copper Winding Wire, paid excise duty at 15% instead of the correct rate of 5% under the Modvat Scheme. Upon realizing the mistake, they filed a claim for refund, which was initially rejected by the Assistant Collector of Central Excise. However, the Collector of Central Excise (Appeals) allowed the appeal, stating that the refund was admissible for the excess duty paid for a specific period. The Assistant Collector's failure to implement this order was deemed improper, leading to a writ petition being filed (C.O. No. 101(w) of 1991).

2. Justice Mrs. Pal disposed of the writ petition by directing the respondents to complete the investigation based on the petitioners' letter and grant credit for the excess duty under the Modvat Scheme within a specified timeframe. Despite this order, no action was taken by the Assistant Collector, citing the matter being sub judice. However, the absence of any interim order and the clear directive from Justice Mrs. Pal indicated that the earlier court order should have been executed without delay.

3. The argument of unlawful enrichment raised by the respondents, suggesting that the petitioners had already recovered the excess payment through increased prices, was dismissed. It was emphasized that statutory authorities must adhere to the law and that the grounds for refusing a refund should be based on statutory provisions, not extraneous factors. The court reiterated that there is no room for equity in taxation matters.

4. Ultimately, the court ruled in favor of the petitioners, directing the respondents to calculate the refund owed as per the Collector's order and grant it promptly. The failure of the Assistant Collector to comply with court directives was highlighted, emphasizing the need for statutory authorities to act in accordance with the law and court orders. The writ petition was disposed of with instructions for the refund calculation and disbursement, with no costs imposed on either party.