2024 (10) TMI 1126 - AT - Central Excise

Rejection of refund of certain amount which was debited by the appellant in response of audit objection raised - rejection for want of clear, related and relevant grounds under Section 11 B of Central Excise Act, 1944 - HELD THAT - Both the authorities bellow have categorically concluded that the amounts were paid by the appellants, they deposited these amounts for the closer of the proceedings that would have been initiated against them for recovery of these amounts in response of the audit objection raised. Taking note of such deposit these proceedings were initiated against the appellants. Accordingly, the claim made by the appellants that amounts were paid in protest also do not have any merits and needs to be rejected. For this reason, these claims would be hit by the bar of limitation also. Hon ble Bombay High Court in the case of M/s National Leather Cloth Manufacturing Co. 2002 (7) TMI 111 - HIGH COURT OF JUDICATURE AT BOMBAY has held that ' we see no reason to interfere with the finding given by the adjudicating authority in rejecting the Petitioners claim as time-barred. Since the payments made during the relevant period are not under protest and the refund claim is beyond the period prescribed under the Act, the adjudicating authority is justified in rejecting the claim as time-barred.' There are no merits in these appeals - appeal dismissed.

Issues Involved:

1. Whether the reversal of Cenvat credit by the appellants in response to audit objections was justified.
2. Whether the refund claims filed by the appellants were barred by limitation under Section 11B of the Central Excise Act, 1944.
3. Whether the payments made by the appellants were under protest, thereby affecting the limitation period.
4. Whether the appellants could claim refunds based on decisions rendered in other cases.

Issue-wise Detailed Analysis:

1. Justification of Reversal of Cenvat Credit:

The appellants, engaged in the manufacture of V.P. Sugar and Molasses, had availed of the Cenvat credit scheme. During audits, it was observed that certain credits were wrongly availed, leading to the reversal of credits by the appellants on various dates. The appellants argued that these reversals were made due to audit objections and cited previous decisions to support their claim that the reversals were improper. However, the Tribunal found that the reversals were made voluntarily by the appellants in response to audit objections, and there was no indication of any payment made under protest. Thus, the Tribunal upheld the lower authorities' decision that the reversal of credits was justified and not improper.

2. Bar of Limitation under Section 11B:

The Tribunal examined whether the refund claims were time-barred under Section 11B of the Central Excise Act, 1944. It was noted that the refund claims were filed on 20.12.2019, long after the reversals were made between 2013 and 2017. The Tribunal referred to the Supreme Court's decisions in Mafatlal Industries Ltd. and Porcelain Electrical Mfg. Company, which emphasized that the limitation period under Section 11B is sacrosanct and cannot be extended. Consequently, the Tribunal concluded that the refund claims were indeed barred by limitation.

3. Payments Under Protest:

The appellants contended that the payments were made under protest, which should have affected the limitation period. However, the Tribunal found that the appellants did not provide any evidence or indication that the payments were made under protest. The self-assessment by the appellants was deemed final, and there was no provision for paying Central Excise duty under protest during the relevant period. Therefore, the Tribunal rejected the appellants' claim that the payments were made under protest.

4. Claiming Refunds Based on Other Cases:

The appellants relied on decisions rendered in other cases to support their refund claims. However, the Tribunal highlighted the Supreme Court's position in Mafatlal Industries Ltd. that a person cannot claim a refund based on a decision in another person's case. The Tribunal emphasized that the appellants must succeed or fail in their proceedings, and the decisions in other cases could not be grounds for claiming refunds. Thus, the Tribunal found no merit in the appellants' reliance on other cases for their refund claims.

Conclusion:

The Tribunal dismissed both appeals, upholding the decisions of the lower authorities. The Tribunal found that the reversals were justified, the refund claims were time-barred, the payments were not made under protest, and the appellants could not rely on decisions in other cases to claim refunds. The Tribunal's decision was pronounced in open court on 21 October 2024.

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