1991 (7) TMI 223 - AT - Central Excise

Summary

Issues:
1. Classification of Mono Filament Yarn of HDPE under Central Excise Tariff 1985.
2. Validity of the letter of protest filed by the appellants.
3. Admissibility of refund claim based on the letter of protest.
4. Requirement to file an appeal against the approved classification list for claiming refund.

Analysis:
1. The case involved the classification of Mono Filament Yarn of HDPE under the Central Excise Tariff 1985. The appellants initially filed a classification list under sub-heading 5406.11, which was later modified to 5406.90 by the Assistant Collector. Despite the modification, the rate of duty and other particulars remained the same as claimed by the assessee. The appellants later filed a letter of protest claiming the product was fully exempt from Central Excise duty, but duty was paid under protest as per the department's opinion. Subsequently, they filed a refund claim, which was rejected on the grounds of not appealing against the approved classification list.

2. The validity of the letter of protest filed by the appellants was contested. The consultant for the appellants argued that the Assistant Collector failed to address the protest letter filed before the approval of the classification list. It was emphasized that the protest letter should have been disposed of before requiring an appeal against the approved classification list. On the other hand, the respondent contended that the protest letter should be deemed disposed of upon approval of the classification list, and the appellants should have appealed against the approved list.

3. The issue of admissibility of the refund claim based on the letter of protest was crucial. The tribunal noted that the appellants had paid duty under protest after filing the letter claiming nil rate of duty. The tribunal held that the protest letter could not be disregarded without a specific appealable order addressing it. The tribunal emphasized that the payment made under protest was saved from limitation, and the statutory right under Section 11B for claiming a refund of duty could not be negated solely due to the absence of an appeal against the approved classification list.

4. Regarding the requirement to file an appeal against the approved classification list for claiming a refund, the tribunal clarified that Sections 11A and 11B operate independently for demanding short levy by the department or claiming a refund by the assessee. The tribunal emphasized that a letter of protest lodged before the approval of the classification list must be considered and rejected by the Assistant Collector. Consequently, the tribunal set aside the lower authorities' orders and remanded the case to the Assistant Collector for reconsideration of the protest letter dated 6-5-1986 and further evaluation of the admissibility of the refund claim based on the merits of the protest.

In conclusion, the tribunal disposed of the appeal by directing a reconsideration of the refund claim based on the letter of protest, emphasizing the importance of addressing protest letters before approval of classification lists and upholding the statutory rights of the assessee under Sections 11A and 11B of the Central Excise Act.