1992 (1) TMI 118 - HC - Central Excise

Summary

Issues Involved:
1. Legality and validity of the order rejecting the refund claim.
2. Applicability of Section 11B of the Central Excises & Salt Act, 1944 to cases of short-credit.
3. Compliance with the conditions of Notification No. 27/87 dated March 1, 1987.
4. Verification of claims by the department.
5. Relevance of prior judicial decisions.

Summary:

1. Legality and Validity of the Order Rejecting the Refund Claim:
The petitioner company, engaged in the manufacture of vegetable products, claimed a refund of Rs. 18,61,844/- for short credit availed from March 1, 1987, to August 24, 1989. The Assistant Collector of Central Excise issued a show cause notice and subsequently rejected the refund claim on April 30, 1991, on grounds of limitation and non-compliance with the conditions of the relevant notification.

2. Applicability of Section 11B of the Central Excises & Salt Act, 1944:
The Assistant Collector rejected the claim on the ground that the refund claim was filed beyond the statutory period of six months as provided u/s 11B of the Act. The court upheld this decision, citing the Supreme Court's ruling in Collector of Central Excise, Chandigarh v. Doaba Co-operative Sugar Mills, which mandates adherence to the statutory period of limitation for refund claims.

3. Compliance with the Conditions of Notification No. 27/87:
The notification specified conditions for availing money credit, including taking credit on the date of hydrogenation and producing necessary certificates. The Assistant Collector found that the petitioner did not comply with these conditions, particularly the requirement to take credit on the same day and produce the V.O.P.P. Controller's certificate.

4. Verification of Claims by the Department:
The court emphasized that allowing claims after the prescribed period would make it impossible for the department to verify compliance with the rules and conditions. The court referenced the Supreme Court's decision in Indian Aluminium Company Limited v. Thane Municipal Corporation, which highlighted the necessity of timely verification by authorities.

5. Relevance of Prior Judicial Decisions:
The petitioner cited Dipak Vegetable Oil Industries Ltd. v. Union of India, arguing that the right to credit was not taken away by the recession of the notification. The court found this decision irrelevant to the present case. The petitioner also relied on Anchor Pressings (P) Ltd. v. Commissioner of Income-tax, which the court distinguished based on the different statutory provisions and objectives of the Income Tax Act and the Central Excises & Salt Act.

Conclusion:
The court rejected the petition both on the ground of limitation and on merits, affirming the Assistant Collector's decision. The petition was dismissed, and the rule was discharged.