1991 (7) TMI 185 - AT - Central Excise

Summary

Issues:
1. Refund claim rejected on grounds of limitation under Section 11B of the Central Excises & Salt Act, 1944.
2. Authority's power to grant relief of refund bypassing the bar of limitation.

Analysis:
The judgment by the Appellate Tribunal CEGAT, Madras dealt with appeals against the Collector of Central Excise (Appeals), Madras' order rejecting refund claims due to limitation under Section 11B of the Central Excises & Salt Act, 1944. The appellants had paid excise duty under a mistake of law and filed Writ Petitions before the Madras High Court, which directed the authorities to consider the issue on merits. The appellants argued that the bar of limitation should not apply when there is a direction to consider the matter on merits. However, the Tribunal held that the bar of limitation cannot be bypassed, citing the Supreme Court's ruling in Miles India Ltd. v. Asst. Collector of Customs, which established that a statutory authority cannot grant relief by ignoring the limitation period. The Tribunal upheld the lower appellate authority's decision and dismissed the appeals, allowing the appellants to seek further remedies within the law.

The main issue revolved around whether a statutory authority can grant a refund despite the claim being time-barred under Section 11B. The Tribunal noted that the High Court's direction to consider the matter on merits did not exclude the applicability of the bar of limitation. The Tribunal emphasized that the limitation period is substantive, not procedural, and cannot be disregarded. The judgment highlighted that the authorities must operate within the confines of the law and cannot overlook the statutory limitations, as established by the Supreme Court's precedent in Miles India Ltd. v. Asst. Collector of Customs. Therefore, the Tribunal upheld the decision to reject the refund claims based on limitation and dismissed the appeals.

In a separate judgment by another member of the Tribunal, it was noted that the appellants had directly approached the Writ Court without any prior order from the authorities regarding the refund claim. The absence of a specific plea to relax the limitation period meant that the authorities correctly interpreted the High Court's direction to consider the issue on merits within the legal framework. The member emphasized that the limitation prescribed in the statute is substantive law and not a mere technicality, supporting the lower authority's decision as valid based on the legal requirements.