1997 (2) TMI 317 - AT - Central Excise

Summary

Issues:
1. Interpretation of Central Duties of Excise (Retrospective Exemption) Act, 1986 regarding refund claims.
2. Applicability of Section 11B of the Central Excises Act, 1944 on refund claims under Central Act 45 of 1986.

Detailed Analysis:
1. The case involved a dispute where the respondent sought a refund of Central Excise duty paid on bulk drugs during a specific period when the exemption notification was reinstated by the Central Duties of Excise (Retrospective Exemption) Act, 1986. The Assistant Collector had initially determined the duty payable by the respondent based on the assumption that the amount equal to the duty had been collected from wholesale dealers. However, the Collector (Appeals) overturned this decision and directed a refund of the entire amount paid as duty. The appellate tribunal upheld the Collector's decision, emphasizing that the determination of assessable value and recomputation of excise duty is irrelevant when no duty was payable under the law, even if some amount had been paid as duty.

2. The issue of whether the refund claims should be subject to the provisions of Section 11B of the Central Excises Act, 1944 was raised during the proceedings. The appellant argued that the refund should comply with Section 11B(2) of the CE Act. In contrast, the respondent contended that the refund claims were governed by Central Act 45 of 1986, and thus, the restrictions and qualifications in Section 11B(2) of the CE Act would not apply. The tribunal explained that Section 11B of the CE Act allows for refund claims within a specified timeframe and underwent amendments in 1991 and 1995. Additionally, Central Act 45 of 1986 provided for the retrospective effect of certain notifications, allowing for the refund of excise duty collected during the relevant period. The tribunal concluded that the refund claims under Central Act 45 of 1986 are not excluded from the purview of Section 11B of the CE Act and remanded the case for further consideration by the adjudicating authority to assess the impact of Section 11B(2) on the refund claim.

In conclusion, the appellate tribunal set aside the previous order and directed a reassessment of the refund claim in light of Section 11B(2) of the Central Excises Act, 1944, emphasizing that the provisions of Section 11B would govern all refund claims of excise duty, including those arising from the Central Act 45 of 1986.