1990 (1) TMI 214 - AT - Central Excise

Summary

Issues Involved:
1. Refund of interest paid on yarn duty.
2. Compliance with Rule 233B for payment under protest.
3. Applicability of Section 11B of the Central Excises & Salt Act, 1944.
4. Jurisdiction of the Tribunal under Section 35B of the Central Excises & Salt Act, 1944.

Detailed Analysis:

1. Refund of Interest Paid on Yarn Duty
The appellants sought a refund of Rs. 61,366.25, representing the interest paid on yarn duty for the period from 6-10-1980 to 13-3-1986. The original authority rejected the refund claim, stating that the interest on yarn duty is collected under Rule 49A of the Central Excise Rules, 1944, as a charge for deferred collection of duty, not as a duty of excise. Therefore, it cannot be rebated under Rule 12A or Rule 13 of the Central Excise Rules, 1944.

2. Compliance with Rule 233B for Payment Under Protest
The Collector (Appeals) held that the appellants did not comply with the provisions of Rule 233B, sub-rule (5), which requires a detailed representation to be made to the Assistant Collector within three months from the date of the protest letter. Since no such representation was made, the protest was considered invalid, and the payment under protest was automatically vacated. Consequently, the refund could not be granted even if the interest on yarn duty was not payable for exports under Rule 13.

3. Applicability of Section 11B of the Central Excises & Salt Act, 1944
The lower authorities examined the refund claim under Section 11B, which allows for a refund application within six months from the relevant date, with an exception for duties paid under protest. The Tribunal noted that the term "duty" under Section 11B refers to the duty payable under Section 3 of the Act. Since interest on yarn duty, collected under Rule 49A, is not considered a duty of excise, Section 11B and its limitation period do not apply. Instead, the general law of limitation would govern the refund claim.

4. Jurisdiction of the Tribunal under Section 35B of the Central Excises & Salt Act, 1944
The Tribunal faced a jurisdictional challenge under Section 35B, first proviso, clause (b), which excludes the Tribunal's jurisdiction in matters related to the rebate of duty on exported goods. The Tribunal concluded that the refund claim for interest on yarn duty, being intertwined with the rebate claim, falls under this exclusion. Therefore, the Tribunal lacks jurisdiction to decide on the appeal. The appropriate forum for such claims is the Government of India.

Conclusion:
The Tribunal, by majority view, held that it does not have jurisdiction to decide the issue and hear the appeal due to the express exclusion under Section 35B, first proviso, clause (b) of the Central Excises & Salt Act, 1944. Consequently, the appeal papers were directed to be returned to the appellants for filing before the appropriate forum.