1998 (12) TMI 93 - HC - Central Excise

Summary

Issues involved:
Claim for Modvat credit and refund of excise duty, time-barred claim, alternative remedy under Section 35 of the Central Excise Act, writ petition jurisdiction, interpretation of Section 11B for refund.

Claim for Modvat credit and refund of excise duty:
The respondent public limited company claimed Modvat credit for excise duty paid on the purchase of titanium anodes, seeking a refund of Rs. 43,96,116.42. The company argued that it was entitled to the credit as titanium anodes were considered inputs under Rule 57A. Despite having received such benefits earlier, the claim for the period in question was not made initially due to a mistaken belief that metal anodes were not covered under Rule 57A. The claim was rejected by the authorities on the grounds that it was not covered by the expression 'refund' in Section 11B and was time-barred.

Time-barred claim and alternative remedy under Section 35:
The company filed a writ petition seeking a declaration of entitlement to Modvat credit and a refund of excise duty. The appellants contended that the claim was time-barred and that the company had not exhausted the alternative remedy provided under Section 35 of the Central Excise Act. The writ court overruled these pleas and allowed the petition, holding the company entitled to refund under Section 11B.

Writ petition jurisdiction and interpretation of Section 11B for refund:
The appellants appealed against the writ court's decision, arguing that the claim was time-barred and that the writ petition was not maintainable due to the availability of an alternative remedy. The court noted that the company had bypassed the statutory remedies by directly approaching the writ court. It emphasized the importance of following the statutory forums for resolving disputes, especially in matters involving public revenue. The court found the writ court's direction somewhat contradictory in terms of finding the company entitled to a refund but subject to the provisions of Section 11B.

Judgment:
The appeal was disposed of by quashing the writ court's judgment and reviving the company's claim under Section 11B for consideration by the Commissioner of Central Excise. The Commissioner was directed to decide the matter within six months from the receipt of the order, without any hindrance of limitation bar or pre-deposit. Both parties were instructed to appear before the Commissioner, with the liberty to seek further legal remedies if aggrieved by the decision.