1996 (7) TMI 331 - AT - Central Excise

Summary

Issues:

1. Validity of refund orders and subsequent review by Collector of Central Excise.
2. Interpretation of Section 35E of the Central Excises and Salt Act, 1944 regarding limitation period for appeals.

Analysis:

Issue 1: The case involves a dispute over the validity of refund orders issued by the Assistant Collector and subsequent review by the Collector of Central Excise. The Respondents filed a refund claim which was initially sanctioned on 5-4-1990 for a reduced amount than claimed. Subsequently, on 22-8-1990, another order was passed sanctioning the same refund claim. The Collector of Central Excise reviewed the initial order and directed an appeal before the Collector (Appeals). The Collector (Appeals) held that the appeal was time-barred as the review order was passed after the limitation period of one year from the date of the initial order. The Collector (Appeals) also deemed the subsequent order infructuous as the Assistant Collector was functus officio after the initial sanction. The Appellate Tribunal considered the legal effect of both orders and the communication with the audit section, ultimately determining that the initial order dated 5-4-1990, followed by the issuance of the refund cheque, was the effective order.

Issue 2: The interpretation of Section 35E(3) of the Act regarding the limitation period for appeals was crucial in this case. The Appellate Tribunal noted that the period of one year for filing an appeal is to be computed from the date of the effective order, which, in this case, was the order dated 5-4-1990. As the review order was passed after the expiry of one year from the initial order, the Collector (Appeals) was correct in holding the appeal as time-barred. The Tribunal emphasized that the date of the order, not the date of communication, is relevant for determining the limitation period. Consequently, the appeal from the Department was rejected based on the correct application of the statutory provisions and legal principles.

In conclusion, the Appellate Tribunal upheld the decision of the Collector (Appeals) regarding the time-barred appeal due to the review order being passed after the limitation period. The Tribunal clarified the legal significance of the initial refund order dated 5-4-1990 as the effective order for computation of the limitation period under Section 35E(3) of the Act.