1992 (11) TMI 189 - AT - Central Excise

Summary

Issues:
1. Interpretation of Section 35E(4) and Section 11A in the context of refund claim.
2. Determination of the limitation period for recovery of erroneously refunded amount.
3. Application of legal precedent in Collector of Central Excise v. Universal Radiators Ltd.

Analysis:
The appeal before the Appellate Tribunal CEGAT, Madras, challenged the order of the Collector of Central Excise (Appeals), Madras regarding a refund claim made by the appellants for clearances during a specific period. The Assistant Collector initially sanctioned the refund claimed by the appellants, but the Collector directed an appeal against this sanction under Section 35E(4). The appellants contended that a demand could not be raised against them without a show cause notice under Section 11A. The Collector (Appeals) allowed the Department's application against the refund, citing that the application under Section 35E(4) was served within six months, satisfying the limitation under Section 11A.

The consultant for the appellants argued that despite the review application being within six months, the absence of a show cause notice under Section 11A meant the demand was not valid within the stipulated period. The Department, represented by the DR, supported the Collector (Appeals)' reasoning. The Tribunal noted that the application under Section 35E(4) was served within six months, aiming to reverse the refund sanctioned by the Assistant Collector. Referring to the case law of Collector of Central Excise v. Universal Radiators Ltd., the Tribunal emphasized that recovery of erroneously refunded amounts must comply with Section 11A, not Section 35E, to avoid exceeding the limitation period.

The Tribunal concluded that any recovery of refund, whether under Section 35E or Section 11A, must occur within six months. Since the application for review was served within this timeframe, the proceedings were not time-barred. The Tribunal rejected the appellants' argument that the demand was limited by time and upheld the decision of the lower appellate authority, dismissing the appeal. The judgment highlights the importance of adhering to the specific provisions for recovery of amounts under the relevant sections of the law to ensure procedural compliance and prevent exceeding the statutory limitation period.