1991 (3) TMI 228 - AT - Central Excise

Issues Involved:
1. Classification of Flush Doors under the Central Excise Tariff.
2. Entitlement to Refund of Excise Duty paid.
3. Jurisdiction and Authority of the Collector (Appeals).
4. Adherence to Statutory Provisions and Time Limits for Refund Claims.

Detailed Analysis:

1. Classification of Flush Doors under the Central Excise Tariff:
The appellants have been manufacturing plywood products, including Flush Doors, classifiable under Item 16B of the erstwhile Central Excise Tariff. They had been declaring Flush Doors in their classification lists as chargeable to duty under the aforesaid tariff item, and these lists were approved by the jurisdictional Assistant Collector of Central Excise. The classification was accepted until the appellants filed a writ petition in September 1980, challenging the levy of duty on Flush Doors.

The respondents argued that the appellants themselves had been categorically indicating in their classification lists that Flush Doors fall under Tariff Item 16B(ii), and these lists were approved by the Assistant Collector. The respondents denied that the appellants were paying duty under compulsion or duress.

2. Entitlement to Refund of Excise Duty Paid:
The appellants sought a refund of Rs. 10,93,969.32, claiming it to be the duty paid from 1972-73 to September 1980 on Flush Doors. The respondents contended that the claim for refund was premature and subject to verification under Section 11B of the Central Excises and Salt Act, 1944. The High Court directed the appellants to avail the alternative remedy of filing an appeal within two months.

The appellants argued that the classification lists, which led to the assessment and demand of excise duty, were orders of assessment and demand. They claimed that since the orders contained products not covered by any tariff items, the collection or demand was illegal, and the appeal should have been allowed.

3. Jurisdiction and Authority of the Collector (Appeals):
The Collector (Appeals) dismissed the appeal as not maintainable under Section 35 of the Central Excises and Salt Act, 1944. The Collector (Appeals) noted that the appellants were not aggrieved by the approval of the classification lists filed by them, as the Assistant Collector had merely approved the classification of Flush Doors as sought by the appellants.

The appellants contended that the Collector (Appeals) was bound to carry out the direction of the High Court and grant relief. They argued that the appeal should have been disposed of on merits, as directed by the High Court.

4. Adherence to Statutory Provisions and Time Limits for Refund Claims:
The respondents emphasized that any claim for refund due to reclassification of goods would have to be considered in terms of Section 11B of the Central Excises and Salt Act, 1944. The appellate authorities, being creatures of the statute, could not go beyond the statute. The High Court did not pass any order on the writ petition, and the departmental authorities had to act within the statutory framework.

The appellants were advised to file a claim for refund or for reclassification of their goods soon after learning about the Delhi High Court judgment. However, they chose to file a writ petition to avoid the time limits prescribed under the Central Excise Law. The Collector (Appeals) reiterated that the appellants could lodge a claim for refund before the appropriate authority, which the appellants did not pursue.

Conclusion:
The Tribunal concluded that the appellants were attempting to maximize the advantage of the Delhi High Court judgment by avoiding the statutory time limits for refund claims. The order passed by the Collector (Appeals) was deemed correct, and the appeal was dismissed. The appellants were not entitled to interpret the High Court's order in a way that disregarded the statutory provisions and sought a refund of duty paid from 1972 onwards. The appeal was rejected, and the Tribunal upheld the decision of the Collector (Appeals).

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