2000 (3) TMI 332 - Commissioner - Central Excise

Summary

Issues:
Refund claim rejection as time-barred under Section 11B of the Act.

Analysis:
The case involves an appeal against the rejection of a refund claim for Rs. 17,885 as time-barred under Section 11B of the Act by the Assistant Commissioner. The appellants, manufacturers of Uninterruptible Power Supply System, took Modvat credit of duty paid on a diesel generating unit. The department issued a show cause notice proposing denial of credit for units over 75 KVA. The Commissioner (Appeals) allowed the credit, stating that the condition of 75 KVA had been removed. The appellants filed a refund claim later, which was rejected by the Assistant Commissioner as time-barred since the duty was not paid under protest, citing the Mafatlal Industries case. The appellants appealed this decision.

The main issue before the judge was whether the rejection of the claim as time-barred by the lower authority was sustainable. The appellants argued that the duty payment was not voluntary but a statutory requirement, citing relevant case laws. The judge noted that the appellants had met the statutory obligation of pre-depositing the impugned demand before filing the appeal, which qualifies as a protest. The judge emphasized that pre-deposit is a requirement under Section 35F for filing an appeal and is considered a protest. The judge referenced various case laws supporting the appellant's plea and highlighted the applicability of para 146 of the Mafatlal judgment. Consequently, the judge ruled in favor of the appellants, stating that they are entitled to the return of the debited amount in their PLA account, setting aside the time-barred rejection and directing the lower authority to deal with the refund claim on merits.

In conclusion, the judge allowed the appeal in favor of the appellants based on the statutory obligation of pre-depositing the impugned demand before filing the appeal, which qualifies as a protest. The judge emphasized the importance of following legal procedures and cited relevant case laws to support the decision to grant the refund claim. The ruling directed the lower authority to process the refund claim on its merits as per the law.