1988 (10) TMI 243 - AT - Central Excise

Summary

Issues:
1. Refund claim rejection based on duty demand and classification issue.

Analysis:
The appeal was against the rejection of a refund claim by the Collector of Central Excise (Appeals), Madras, which upheld the Assistant Collector's decision to reject the claim for a duty amount of Rs. 18,53,715.82 on laminated packing containers. The appellants contended that Rule 9(2) was wrongly invoked as there was no charge of clandestine removal. The Assistant Collector's order on classification did not explicitly demand duty, and the notice requesting payment of duty was deemed time-barred by the appellants. They argued that a notice under Section 11A was necessary, citing the Supreme Court's decision in Union of India v. Madhumilan Syntex (Pvt.) Ltd. and Jhunjhunwala Rolling Mills case, emphasizing the need for a specific claim for a refund under Section 11B.

The Department argued that the Show Cause Notice clearly outlined the grounds for demanding duty and revising the classification, negating the need for a separate notice for demanding duty. They contended that the approved duty payment classification cannot be circumvented by a refund claim. The Tribunal considered both arguments, focusing on whether a separate notice for demanding duty was required under Section 11A. The Show Cause Notice had detailed the revision of classification and duty demand, and the Assistant Collector's subsequent order confirmed the revised classification from the date of the notice, establishing the appellants' liability for duty.

The Tribunal rejected the appellants' arguments, stating that the Assistant Collector's detailed Show Cause Notice sufficed for demanding duty under Section 11A. They distinguished the Madhumilan Syntex case, noting that in this instance, a thorough notice was issued, and duty demand followed the classification revision. The Tribunal also differentiated the Jhunjhunwala Rollings Mills case, emphasizing the distinct recovery provisions of Sections 11A and 11B. Additionally, they referenced the MAT Steel Equipment Private Ltd. case, supporting the prospective application of revised classifications. Consequently, the Tribunal upheld the lower authorities' decisions, rejecting the appeal and affirming the rejection of the refund claim.