1988 (11) TMI 263 - AT - Central Excise

Summary

Issues:
1. Interpretation of Central Excise Rule 11 regarding the limitation period for refund claims.
2. Application of Central Excise Rule 92B in cases of excess payments of compounded levy.

Analysis:
1. The appeal was against an Order-in-Appeal passed by the Collector of Central Excise (Appeals) regarding a claim for refund of excess Central Excise duty paid by M/s. Rama Sugar Works. The claim was dismissed by the Assistant Collector on the ground of being time-barred under Central Excise Rule 11. However, the Collector (Appeals) accepted the contention of the respondents that the limitation rule did not apply in this case. The main issue was whether the limitation prescribed in Rule 11 applied to the refund of excess compounded levy.

2. The Tribunal examined the relevant provision, Central Excise Rule 92B, which mandates the refund of excess duty paid in the event of a reduction in the rate of compounded levy without the need for the assessee to make a claim. The Tribunal emphasized the mandatory nature of the rule by highlighting the use of the word "shall" in the provision. It was held that Rule 92B overrides Rule 11 in cases of excess payments of compounded levy. The Tribunal concluded that the requirement for the assessee to make a claim within a specified time under Rule 11 did not apply to cases covered by Rule 92B. Therefore, the Tribunal upheld the order setting aside the Assistant Collector's decision and dismissed the appeal challenging the Order-in-Appeal.

3. The Tribunal's decision clarified that in situations where there is an alteration in the rate of duty, the Central Excise Authority is obligated to refund the excess amount paid without the assessee having to make a specific claim for the refund. This interpretation ensures that the excess payments of compounded levy are returned to the assessees in compliance with Rule 92B, without the need for the assessee to adhere to the time limitation specified under Rule 11 for making refund claims. Consequently, the Tribunal's ruling favored the respondents and affirmed the order-in-appeal that allowed the refund claim for the excess amount paid due to the reduction in the compounded levy rate.