1997 (4) TMI 81 - SC - Customs

Refund claim - Held that - The question of refund will now be governed by the decision of this Court in Mafatlal Industries v. Union of India 1996 (12) TMI 50 - SUPREME COURT OF INDIA

Summary

Issues:
1. Interpretation of refund application timeline under Central Excise Act/Customs Act.
2. Entitlement to file an appeal based on dismissal of refund application.
3. Procedure for filing a refund claim directly in High Court/Civil Court.
4. Exception for refund of duty under unconstitutional provision.
5. Impact of challenging constitutionality of provisions on refund claims.
6. Requirement of affidavit regarding passing on duty burden.
7. Liability to repay refunded amount if claim is rejected.

Analysis:

1. The judgment discusses the interpretation of the timeline for filing a refund application under the Central Excise Act/Customs Act. It emphasizes that applications filed beyond the prescribed period are untenable in law and cannot be extended by any authority or court, as per the decision in Mafatlal Industries v. Union of India.

2. Regarding the entitlement to file an appeal after the dismissal of a refund application, the judgment allows the manufacturer/purchaser to withdraw the writ petition, suit, or appeal and file an appeal before the appropriate appellate authority within sixty days from the decision date. This provision applies even if a writ petition has been allowed, and an appeal by the revenue is pending.

3. The judgment outlines the procedure for filing a refund claim directly in the High Court/Civil Court without submitting a refund application. The petitioner/plaintiff can withdraw the writ petition/suit and prefer a refund claim under Section 11B within sixty days if the original filing was within the prescribed period.

4. An exception is made for refund claims of duty levied and recovered under an unconstitutional provision. In such cases, the period of limitation is prescribed in Mafatlal Industries, with the duty to prove that the duty has not been passed on to another person still applicable.

5. It is highlighted that if a person challenges the constitutionality of a provision in the Central Excise Act/Customs Act but fails, they cannot benefit from another person's successful challenge to the provision, specifically in the context of refund claims under these enactments.

6. The judgment mandates that a refund application or appeal will only be entertained if the applicant files an affidavit stating that they have not passed on the duty burden claimed for refund to another person. The affidavit must be submitted by the Managing Director or Principal Officer of a company or society, as applicable.

7. Finally, the judgment addresses the liability to repay any refunded amount if a refund claim is rejected. If an assessee has obtained a refund and the claim is later rejected, they are obliged to repay the refunded amount to the department, which can recover it in accordance with the law and any orders by an Appellate Authority.