2003 (8) TMI 55 - HC - Central Excise

Export - Rebate claim - Amended limitation period - right to retate of duty accrues - Interpretation of Section 11B of the Central Excise Act, 1944 ( Act ) which came to be amended with effect from 12th May, 2002 - HELD THAT - In present case, when the exports were made in the year 1999 the limitation for claiming rebate of duty u/s 11B was six months. Thus, for exports made on 20th May, 1999 and 10th June, 1999 the due date for application of rebate of duty was 20th November, 1999 and 10th December, 1999 respectively. However, both the applications were made belatedly on 28th December, 1999, as a result, the claims made by the petitioners were clearly time-barred. Section 11B was amended by Finance Act, 2000 with effect from 12th May, 2000, wherein the limitation for applying for refund of any duty was enlarged from 'six months' to 'one year'. Although the amendment came into force with effect from 12th May, 2000. Section 11B merely debars the remedy if the claim is not filed within the period of limitation set out therein. if there is alteration in the procedural law, there is no reason to presume that the amendment was not intended to apply retrospectively. In other words, where the amended statute alters the existing practice and procedure of enforcing the substantive rights, then the amended, procedure would apply for enforcement of the substantive rights existing on the date when the amended provisions came into force. Accordingly, we hold that the limitation of one year provided by amendment to Section 11B with effect from 12th May, 2000 would apply retrospectively and would cover exports made one year prior to 12th May, 2000. To put it differently the amended limitation of one year with effect from 12th May, 2000 would apply to all exports made after 12th May, 1999. In the present case, the exports were effected on 20th May, 1999 and 10th June, 1999 i.e. within one year from 12th May, 2000 and hence, the amended limitation period of one year would apply to the case of the petitioners. Alternatively, once it is held that the limitation u/s 11B is procedural, then any amendment to such procedural law can be said to have retroactive effect if not the retrospective effect. The amended Section 11B, without affecting the existing substantive right, merely enables an expanded remedy period. In other words, even if the amendment is not to have retrospective effect, it would nevertheless have retroactive effect and in that view of the matter, the case of the petitioner's would be covered within the amended period of limitation and thus the petitioners would be entitled to rebate of duty. In the light of the view taken, for the reasons recorded, we do not think it necessary to dwell upon other contentions raised by the petitioners. In the result, petition is allowed. Rule is made absolute in terms of the prayer clauses (a) and (b) of the petition with no order as to costs.

Summary

Issues Involved:

1. Validity of the show cause notice.
2. Retrospective or retroactive effect of Section 11B.
3. Applicability of Section 6 of the General Clauses Act, 1897.

Summary:

1. Validity of the Show Cause Notice:

The petitioners argued that the show cause notice dated 7th March 2001 was contrary to law and without jurisdiction because, by that date, Section 11B had already been amended to extend the limitation period to one year. The petitioners contended that their rebate claims, filed on 28th December 1999, were within the one-year period from the date of shipment. They cited the judgments of Godrej & Boyce Manufacturing Co. Pvt. Ltd. v. Union of India and Mysore Rolling Mills Pvt. Ltd. v. Collector of Central Excise to support their position that the validity of the show cause notice should be judged based on the law as it stood on the date of its issuance. The Revenue countered that the amendment was prospective and did not apply to claims already time-barred under the previous six-month limitation.

2. Retrospective or Retroactive Effect of Section 11B:

The petitioners argued that Section 11B is procedural, and procedural statutes are presumed to be retrospective unless textually inadmissible. They cited several judgments, including Shahid Ganj v. S.G.P. Committee and Hitendra Vishnu Thakur v. State of Maharashtra, to support their claim that the amendment should apply retrospectively. The Revenue contended that the amendment affected substantive rights and thus could not be applied retrospectively. The court held that the limitation under Section 11B is procedural and, therefore, the amendment extending the limitation period to one year applies retrospectively. The court noted that the right to rebate accrues under Rule 12 upon export, and the limitation under Section 11B only bars the remedy, not the substantive right.

3. Applicability of Section 6 of the General Clauses Act, 1897:

The petitioners argued that Section 6 of the General Clauses Act does not apply because the amendment to Section 11B did not constitute a repeal of a Central Act. They contended that the amendment expanded the procedural machinery for claiming rebates and should apply to all claims within one year from 12th May 2000. The Revenue argued that Section 6 preserved their right to deny the rebate claims. The court held that Section 6 did not apply as there was no saving clause in the amendment. The court emphasized that the amended procedural law should apply to all pending claims.

Conclusion:

The court concluded that the amended limitation period of one year under Section 11B applies retrospectively to all exports made after 12th May 1999. The petitioners' rebate claims, filed within this extended period, were valid. The petition was allowed, and the rule was made absolute in terms of the prayer clauses (a) and (b) of the petition.