2014 (3) TMI 747 - AT - Central Excise

Denial of refund claim - Bar of limitation - The consignee viz., PWD, Government of Karnataka was not aware of, nor they indicated in the purchase order that they would be eligible for the duty exemption benefit in terms of Notification No.108/95-CE dated 20.8.1995. - Whether they can claim the refund of Central Excise duty remitted by them but not paid by PWD though the bill was raised including Central Excise duty - If the refund of duty is to be claimed, can it be claimed by them or it has to be claimed by the consignee. - Held that - appellant failed to show anywhere in the correspondences made by the appellant to the department that there was a specific request to sanction refund of the amount paid. It has to be noted that as early as 3.3.2006, PWD had written to Deputy Commissioner stating that they would not be paying the amount to the appellant and there was a delay in producing the certificate. The proper course for the appellant to follow was to file an appeal against the decision communicated to them by the Assistant Commissioner on 24.11.2005 stating that since they have not fulfilled the conditions under Notification No.108/95 they are not eligible for the refund. This was a decision communicated to the appellant, which could have been challenged and they did not do so. As early as 3.3.2006 PWD made it clear that they would not be paying the amount. A request by the third party or a customer to the department requiring the department to reimburse the amount of duty paid cannot be considered as refund claim at all - there is not even a single line stating that I may please be granted refund of Central Excise duty . Under these circumstances the rejection of refund on the ground of limitation by the lower authorities cannot be faulted with - Decided against assessee.

Summary

Issues:
Claim for refund of Central Excise duty based on Notification No.108/95-CE dated 20.8.1995.

Analysis:
The appellant, engaged in manufacturing UPS and equipment, received a purchase order from the Public Works Department (PWD) for supply and installation of UPS systems. The purchase order indicated that the value was inclusive of excise duty and sales tax. The appellant charged and paid the excise duty amounting to Rs.14,80,275. However, PWD claimed exemption under Notification No.108/95-CE dated 20.8.1995, stating they were eligible for duty exemption due to a World Bank loan project. The appellant sought clarification from the Assistant Commissioner regarding refund eligibility. The Assistant Commissioner responded that the appellant did not fulfill the conditions of the notification, thus not eligible for refund. Subsequently, PWD informed they would not reimburse the excise duty amount. The appellant filed a refund claim in March 2007, which was rejected due to being beyond the one-year limitation period under Section 11B of the Central Excise Act, 1944.

The appellant contended that their correspondences with the department indicated a continuous request for refund. They argued that PWD's letter to reimburse the duty should be considered a refund claim. Referring to a Tribunal decision, the appellant claimed entitlement to a refund based on the circumstances.

The Tribunal analyzed the submissions and records, finding no explicit request for refund in the appellant's correspondences with the department. The Tribunal noted that PWD's communication in 2006 about non-payment and delay in producing a certificate should have prompted the appellant to appeal the Assistant Commissioner's decision. The Tribunal emphasized that a third party's request for reimbursement does not constitute a refund claim. Despite clearances from June 2012 onwards, the appellant did not file a refund claim until March 2007, raising questions about the delay. The Tribunal concluded that the appellant failed to seek a refund in their interactions with the department, leading to the rejection of the claim based on the limitation period. The Tribunal declined to delve into the merits of the issue, upholding the lower authorities' decision and dismissing the appeal.