1991 (8) TMI 213 - AT - Central Excise

Summary

Issues:
- Appeal against the order passed by the Collector (Appeals) regarding refund of duty on goods cleared twice.
- Interpretation of Section 11B of the Central Excise Act and Rules 173H, 173L, 173M, 173MM.
- Whether the appellants can claim refund under Section 11B for the duty paid on goods cleared twice without following Rule 173L.

Analysis:
1. The appeal was filed challenging the rejection of the refund claim for duty paid on goods cleared twice. The appellants initially cleared switchgear with accessories under G.P. No. 584 in 1983, then re-entered the goods under Rule 173H in 1984, but later cleared the same goods again to another customer under G.P. No. 1299. The claim for refund was based on the argument that duty was paid twice on the same goods, making them eligible for a refund under Section 11B within the prescribed time limit.

2. The appellant's advocate argued that since the goods were cleared again on payment of duty without any reconditioning or repair, the duty paid the second time should be refunded as per Section 11B. It was emphasized that the claim was not under Rule 173L but solely under Section 11B for the double payment of duty on the same goods.

3. The Member (Tribunal) analyzed the legal provisions, specifically Section 11B of the Central Excise Act and Rules 173H, 173L, 173M, 173MM. It was highlighted that goods cleared under self-removal procedures could only be re-entered under Rule 173H or Rule 173L. The appellants re-entered the goods under Rule 173H for repair/reconditioning but cleared them again without following Rule 173L for refund. The Tribunal held that the appellants should have either cleared the goods under Nil rate under Rule 173H or claimed a refund under Rule 173L, as re-entry was allowed expressly under these rules.

4. The Tribunal concluded that the appellants cannot ignore Rule 173L and seek a refund under Section 11B alone, especially when Section 11B includes cases of refund for re-entered goods. It was noted that the appellants failed to comply with the provisions of Rule 173L by bringing the goods back after more than a year, rendering their claim unsustainable under Section 11B. The rejection of the claim was not solely based on time limitations but also on the failure to meet the requirements of Rule 173L for duty paid re-entered goods.

5. Rejecting the appeal, the Tribunal emphasized that the rules like 173H and 173L were designed to prevent double payment of duty on re-entered goods. By not following the prescribed rules, the appellants cannot circumvent the system and claim refunds under Section 11B alone. The decision of the lower authorities to reject the claim was upheld, highlighting the importance of adhering to the specific rules governing re-entered goods to avoid misuse of refund provisions.