1986 (10) TMI 155 - AT - Central Excise

Classification list effective from date of filing and not from date of approval by Assistant Collector

Issues: Eligibility of the appellants for refund in respect of the product "Vitamin Premix" for the period from 1978 to 30-10-1981.

Analysis:
The appeal before the Appellate Tribunal CEGAT, New Delhi involved the eligibility of the appellants, a Government of India undertaking, for a refund concerning their product "Vitamin Premix" for the period from 1978 to 30-10-1981. The appellants had initially classified and cleared their product under Tariff Item 14-E of the Central Excise Tariff. However, on 9-3-1981, they filed a classification list claiming Tariff Item 68 as the proper classification for their product, although they continued to pay duty under Tariff Item 14-E until 1-4-1982 when the classification under Tariff Item 68 was approved by the Assistant Collector. The issue arose when the appellants applied for a refund of the differential duty paid for the specified period. The Assistant Collector, in his Order-in-Original dated 20-9-1982, held that the claim for refund of the duty paid on products cleared on or before 9-6-1981 was time-barred under section 11-B of the Central Excises and Salt Act, 1944. Despite this, the Assistant Collector rejected the entire claim for refund in the final paragraph of his order, leading to the appeal before the Tribunal.

The consultant for the appellants argued that they were only pressing the claim for refund for the period from 9-3-1981 to 30-10-1981, as this was when they filed the classification list under Tariff Item 68. The appellants had been paying full duty during this period, even making endorsements on gate passes to indicate payment under protest. They had also written letters to the Assistant Collector requesting permission to pay duty under Tariff Item 68 and not under 14-E. The consultant contended that Rule 233-B of the Central Excise Rules, 1944, which governs the procedure for duty paid under protest, came into force on 1-6-1981, and the appellants' claim for the period after 9-6-1981 was not time-barred according to the Assistant Collector's own findings. The respondent agreed that the claim for refund for the period from 9-6-1981 to 30-10-1981 should have been granted based on the Assistant Collector's reasoning. However, the respondent argued that the claim for the period from 1-6-1981 to 9-6-1981, after Rule 233-B came into force, should be rejected as the appellants had not followed the prescribed protest procedure during that time.

The Tribunal, after considering the arguments and facts presented, found that the appellants' classification list should have been given effect from 9-3-1981 when it was filed, rather than from 1-4-1982 when it was approved. As the appellants were paying full duty, there was no requirement for them to follow the provisional assessment procedure under Rule 173-B(2-A) and Rule 9-B. The Tribunal noted that the substantial part of the appellants' claim after 9-6-1981 to 30-10-1981 was not affected by Rule 233-B, and the only part that could be rejected based on the rule was from 1-6-1981 to 9-6-1981. Therefore, the Tribunal granted and allowed the appellants' claim for refund for the periods from 9-3-1981 to 31-5-1981 and 10-6-1981 to 30-10-1981, while rejecting the rest of their claim. The appeal was disposed of accordingly.

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