2004 (9) TMI 191 - AT - Central Excise

Summary

Issues Involved:
1. Refund claim for excise duty paid on coin blanks supplied by SAIL's Salem Steel Plant.
2. Application of the limitation provisions under Section 11B of the Central Excise Act.
3. Retrospective effect of ad hoc exemption orders.
4. Adjustment of Modvat credit against the refund sanctioned.

Detailed Analysis:

1. Refund Claim for Excise Duty Paid on Coin Blanks:
The appellants, M/s. Steel Authority of India (SAIL), supplied 2640 MTs of stainless steel coin blanks to the Government Mint, part of which was cleared on payment of excise duty. SAIL filed a refund claim for the duty paid on these supplies for the period 1-1-1994 to 12-10-1994, following an ad hoc exemption granted by the Government of India. The Assistant Commissioner rejected the refund claim for the period 1-1-1994 to 17-5-1994 as time-barred and sanctioned the refund for the period 18-5-1994 to 12-10-1994 after adjusting Modvat credit.

2. Application of the Limitation Provisions Under Section 11B:
The Assistant Commissioner and the Commissioner (Appeals) rejected part of the refund claim as time-barred under Section 11B of the Central Excise Act, which prescribes a six-month limitation period from the date of payment of duty. The appellants argued that the limitation should be reckoned from the date of receipt of the ad hoc exemption order (17-10-1994), citing the maxim "impotentia excusat legem" (impossibility excuses the law). However, the Tribunal held that equitable considerations cannot override statutory limitations and that the appellants could have paid the duty under protest or requested provisional assessment to avoid the time-bar.

3. Retrospective Effect of Ad Hoc Exemption Orders:
The ad hoc exemption order dated 21-9-1994 was later amended to apply retrospectively from 1-1-1994. The Tribunal noted that while the exemption order provided a cause of action for the refund, the relevant date for the limitation period under Section 11B remained the date of payment of duty. The Tribunal distinguished this case from others cited by the appellants, emphasizing that the limitation provisions must be strictly applied as per the Supreme Court's rulings in Doaba Co-Operative Sugar Mills and Miles India Ltd.

4. Adjustment of Modvat Credit Against the Refund Sanctioned:
The refund for the period 18-5-1994 to 12-10-1994 was sanctioned after adjusting the Modvat credit availed on the inputs used in manufacturing the coin blanks. The appellants' challenge to this adjustment was noted, but it was conceded that the issue had already been settled in SAIL v. CCE, Coimbatore.

Conclusion:
The Tribunal upheld the rejection of the refund claim for the period 1-1-1994 to 17-5-1994 as time-barred and affirmed the sanction of the refund for the period 18-5-1994 to 12-10-1994, subject to the adjustment of Modvat credit as per the previous order. The appeal was rejected, emphasizing the strict application of the limitation provisions under Section 11B of the Central Excise Act.