1985 (9) TMI 217 - AT - Central Excise

Summary

Issues Involved:

1. Starting point for limitation: Date of payment of duty vs. Date of assessment of the RT 12 return.
2. Reference date for computation of the period of limitation under Rule 11.

Detailed Analysis:

1. Starting Point for Limitation:

The primary issue in the case was determining the starting point for the limitation period for claiming a refund of duty. There was a difference of opinion between the two members of the West Regional Bench, Bombay. One member, Shri Venkatesan, opined that the limitation period began from the date of payment of duty, whether in cash or by debit in the Personal Ledger Account (P.L.A.), and not from the date of assessment by the proper officer on the RT 12 return. Conversely, Shri Hegde believed that the reference date for the computation of the period of limitation prescribed in Rule 11 should be the date of adjustment that the assessee makes in the P.L.A. on receipt of a copy of the RT 12 return from the proper officer.

2. Reference Date for Computation of the Period of Limitation Under Rule 11:

Shri Kampani, representing the appellant, supported Shri Hegde's view and relied on the observations of the Patna High Court in Rohtas Industries Ltd. v. Superintendent of Central Excise (AIR 1973 Patna 446). He argued that the duty payment made by the assessee at the time of removal of the goods became final only when the RT 12 return was filed and assessed by the proper officer. The payment of duty by debit in the P.L.A. at the time of removal of the goods was merely a debit entry and not a final payment of duty. He cited various decisions, including 1985 ECR 636, 1977 E.L.T. 127, and 1982 E.L.T. 478, to support his argument. However, he did not go so far as to say that the reference date for limitation purposes should be the date of adjustment in the P.L.A. as a consequence of the assessment by the proper officer but rather the date of assessment by the proper officer.

Shri Iyer, representing the respondent, contended that Rule 11 did not reference the assessment process but rather the fact of payment of duty by debit in the P.L.A. He argued that under the Self Removal Procedure (S.R.P.), the payment of duty followed the self-determination of duty due by the assessee based on approved classification and price lists, and this payment constituted the reference date for the computation of the period of limitation.

The Tribunal member, after considering the matter, concluded that the term "adjustment" in Rule 11 referred to adjustments in the account-current maintained with the Collector under Rule 9. Under the Physical Control procedure, the payment of duty followed the assessment process, but under the S.R.P., the payment of duty by debit in the P.L.A. followed the self-determination of the duty due by the assessee. The Tribunal member opined that the date of payment of duty by book-debit on self-determination of the duty liability by the assessee should be the reference date for the computation of the period of limitation under Rule 11. If, upon assessment of the RT 12 return by the proper officer, the assessee was required to pay an additional sum, the date of payment of such additional duty by debit in the P.L.A. would constitute a second reference date for the computation of limitation, but strictly limited to the additional sum paid.

Judgment:

The Tribunal, in view of the majority opinion, dismissed Appeal No. 1/85 filed by the appellant. The Appeal No. 6/85 filed by the Collector of Central Excise, Thane, was allowed in part. The refund claim for the period of one year prior to 5-4-1977, i.e., from 6-4-1976 to 5-4-1977, was considered as not being barred by limitation.