1991 (1) TMI 284 - AT - Central Excise

Summary

Issues:
1. Refund claim rejection under Rule 173H of Central Excise Rules.
2. Captive consumption for manufacturing dutiable goods.
3. Failure to consider relevant provisions for refund entitlement.
4. Lack of examination of refund claim from all perspectives.

Analysis:
The appeal before the Appellate Tribunal CEGAT, Bombay was against the rejection of a refund claim amounting to Rs. 4708.13 by the Collector of Central Excise (Appeals) Bombay. The claim was initially rejected by the Assistant Collector of Central Excise, Division III, Kalyan, citing Rule 173H of the Central Excise Rules. The appellants, manufacturers of dye intermediates, had initially cleared a consignment of metanilic acid in solution but received part of the goods back as rejected. They claimed to have used the returned goods captively for manufacturing metanilic acid powder, which was later cleared under a valid gate pass with duty paid. The authorities below only considered Rule 173H in rejecting the claim, failing to examine other relevant provisions such as Rule 173L, which could entitle the appellants to a refund. The Tribunal noted that the fundamental principle of no double duty on an article was not considered by the lower authorities. The Tribunal held that the authorities should have evaluated the refund claim comprehensively from all angles and not limited their analysis to one provision. Therefore, the orders of the lower authorities were set aside, and the matter was remanded back to the Assistant Collector for a thorough examination of the refund claim, providing the appellants with an opportunity to present further evidence if needed. The Assistant Collector was directed to prioritize the decision and resolve the issue within three months from the date of the order.