2003 (9) TMI 189 - AT - Central Excise

Summary

Issues:
Refund claim rejection as time-barred under Rule 233B of Central Excise Rules.

Analysis:
The appeal was filed against the rejection of a refund claim by the Commissioner (Appeals) as time-barred under Rule 233B of the Central Excise Rules. The appellant, a manufacturer of Oscilloscope and measuring instruments, availed Modvat credit on duty paid inputs. During a factory visit, Central Excise Officers noted an incomplete RG-23A, Part I register. Following their direction, the appellants debited Modvat credit under protest and later filed a refund claim. The Asstt. Commissioner rejected the claim for not fulfilling Rule 233B conditions. The Commissioner (Appeals) upheld this decision, stating the reversal of Modvat credit was not made under protest. The appellant argued the debited amount was a pre-deposit during investigation, and Rule 233B provisions are not mandatory. Citing a Tribunal case, they contended a refund claim cannot be denied for non-fulfillment of such procedures.

The Member (T) observed discrepancies in the Commissioner (Appeals)'s findings. The Central Excise Officers directed the appellants to reverse Modvat credit before completing Part I register due to an ongoing investigation. The appellants promptly explained the incomplete register situation in a letter to the Supdt. (Preventive) and stated the debited amount was under protest. Since Modvat reversal was not a continuous process, other Rule 233B provisions did not apply. Consequently, the impugned Order was set aside, and the matter was remanded for the adjudicating authority to consider refund sanction in compliance with the law.