2018 (4) TMI 104 - AT - Central Excise

Refund claim - time limitation - relevant date - Section 11B of the CEA 1944 - Held that - both the authorities have wrongly computed the period of limitation from the relevant date - the sale transaction completes only on the payment of the amount indicated in the invoice and not from the date of invoice and in the present case the payments were made from 04.04.2014 to 21.04 2014 and if this is taken as a relevant date then the refund was well within the time limit and the rejection of refund on time-bar is not legally tenable - appeal dismissed - decided against Revenue.

Summary

Issues:
1. Refund claim rejection based on time limitation
2. Jurisdiction of Central Excise officers in SEZ matters

Issue 1: Refund claim rejection based on time limitation:
The appeal involved two parties - the Department and the assessee, filing appeals against a common order regarding a refund claim. The Department appealed against the refund granted, while the assessee appealed against the rejection of part of the refund claim. The dispute arose from a refund claim of Central Excise duty paid for LPG procurement. The Commissioner (Appeals) rejected a portion of the claim as time-barred, but allowed the rest. The Revenue challenged the allowance of the refund, arguing that SEZ units are considered foreign territories and thus not entitled to refunds. The Tribunal noted that the authorities had wrongly computed the limitation period, finding that the transaction completion date, not the invoice date, should be considered. As the payments were made within the stipulated period, the rejection based on time-bar was deemed legally incorrect. Consequently, the assessee's appeal was allowed, and the Department's appeal was dismissed.

Issue 2: Jurisdiction of Central Excise officers in SEZ matters:
The Tribunal addressed the jurisdictional issue, citing a Division Bench ruling in a similar case. It was established that SEZ units have the standing to claim refunds, and the Ministry of Commerce clarified that Central Excise officers have jurisdiction over SEZ-related claims. The Tribunal set aside the earlier order and directed a fresh examination of the claim, emphasizing that Central Excise officers are authorized to handle such matters. The Tribunal referenced a High Court ruling supporting the assessee's position and dismissed the Revenue's appeal. The Tribunal underscored that SEZ units are exempt from Central Excise duty for authorized operations under the SEZ Act. The Tribunal highlighted that the relevant date for limitation purposes should be based on the payment date, not the invoice date, as per the Sale of Goods Act and Section 11B of the Central Excise Act. Ultimately, the Tribunal allowed the assessee's appeal and dismissed the Department's appeal, concluding the matter in favor of the assessee.

In conclusion, the Tribunal's judgment favored the assessee on both issues, highlighting the correct computation of the limitation period and affirming the jurisdiction of Central Excise officers in SEZ-related refund claims. The detailed analysis provided clarity on the legal principles applied, ensuring a fair and comprehensive resolution of the dispute.