2004 (9) TMI 181 - AT - Central Excise

Summary

Issues:
Claim of refund barred by limitation due to failure to follow procedure for payment of duty under protest.

Analysis:
The appeal before the Appellate Tribunal CESTAT, Mumbai arose from the Commissioner of Central Excise (Appeals) rejecting a claim of refund amounting to Rs. 37,68,834 as time-barred. The appellants contended that the duty was paid under protest, thus not subject to limitation. The Assistant Commissioner found that the procedure for payment of duty under protest, as per Rule 233B of the Central Excise Rules, was not followed because the required letter detailing the grounds of payment under protest was not produced by the appellants.

During the proceedings, the appellants argued that they had indeed followed the procedure under Rule 233B. They referred to a letter from the Range Superintendent instructing them to obtain a license for manufacturing polyurethane foam, which the appellants responded to by applying for a license under protest. This exchange indicated their objection to the classification of their product under Tariff Heading 3921.11 as polyurethane foam. The Tribunal noted that the appellants had lodged a letter of protest and that the duty was accepted as paid under protest by the Assistant Commissioner.

After a thorough examination of the correspondence between the parties, the Tribunal concluded that the appellants had met the requirements of Rule 233B by lodging the protest letter and clearing the goods with the duty paid under protest endorsement on gate passes. Consequently, the Tribunal held that the claim for refund was not time-barred and set aside the Commissioner's order. The matter was remanded to the Assistant Commissioner/Deputy Commissioner for further assessment of the refund eligibility under Section 11B. Ultimately, the appeal was allowed for remand, providing the appellants with an opportunity to establish their entitlement to the refund.