1990 (12) TMI 293 - AT - Central Excise

Issues Involved:
1. Refund of central excise duty.
2. Inclusion of equalized freight in assessable value.
3. Requirement of modifying/revising the price list for refund claims.
4. Interpretation of Sections 11A and 11B of the Central Excises and Salt Act.

Detailed Analysis:

Refund of Central Excise Duty:
The dispute centers around the refund of central excise duty amounting to Rs. 64,539/- paid under protest. The appellant company sold goods through various sales offices and included a uniform delivery charge in their pricing. They filed a price list on 18th September 1979, which was approved by adding the delivery charges, and they paid the duty under protest from 17th January 1980 to 3rd May 1980. The refund claim filed on 27th October 1980 was rejected by the Assistant Collector, and this rejection was upheld by the Collector on appeal.

Inclusion of Equalized Freight in Assessable Value:
The main contention by the appellants was that the equalized freight should be excluded from the assessable value, citing the Supreme Court judgment in Bombay Tyre International (1983). The department, however, argued that since the appellants did not appeal against the price list approval which included the equalized freight, the refund claim was not maintainable. The department relied on several judgments, including Madhumilan Syntex (1988), to support their stance.

Requirement of Modifying/Revising the Price List for Refund Claims:
The Tribunal had to decide whether the appellants were entitled to a refund without seeking revision or modification of the price list. The facts showed that the price list filed on 18th September 1979 was approved with the inclusion of equalized freight, and no appeal was filed against this approval. The Tribunal referred to its earlier decision in Modi Rayon & Silk Mills, where it was held that refund claims are not maintainable if deductions were not claimed in the approved price list. However, the Calcutta High Court in ITC Ltd. v. UOI overruled this observation, stating that Sections 11A and 11B are self-contained provisions and do not depend on other provisions or proceedings under the Act.

Interpretation of Sections 11A and 11B of the Central Excises and Salt Act:
The Calcutta High Court's interpretation emphasized that Sections 11A and 11B provide a complete code for the realization and refund of excise duty, respectively. The Court rejected the argument that these sections could only be invoked in conjunction with appellate and revisional jurisdictions under Sections 35A and 35EE. The Supreme Court's judgment in Madhumilan Syntex was examined in detail, where it was implied that without modifying the classification list, no demand can be enforced. However, a later Supreme Court judgment in Elson Machines (1988) held that demand can be enforced even without modifying the classification list.

The Tribunal decided to follow the later judgment in Elson Machines, concluding that the refund cannot be rejected on the ground that the price lists were not modified. This view was taken despite an earlier Tribunal order in Maheshwari Mills, which followed the Madhumilan Syntex judgment without considering the later Elson judgment.

Conclusion:
The Tribunal held that the appellants' claim for refund on account of payment of duty by including delivery charges should be allowed. It cited the Tribunal's order in Associated Pigments v. CCE, which held that delivery charges incurred beyond the factory gate are deductible. Thus, the appeal was allowed, and the orders of the lower authorities were set aside.

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