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TMI Blog1986 (7) TMI 251X X X X Extracts X X X X X X X X Extracts X X X X ..... reinafter called the Rules ), erroneously and/or mistakenly declaring that the aforesaid Coca Cola and Fanta (Orange) fell within the ambit of T.I. 1D of the First Schedule whereunder the rate of duty was 20% ad valorem. The classification list submitted by the appellants effective from 1972 was approved by the Superintendent of Central Excise, Gauhati. In or about March, 1976, the tariff description under aforesaid item 1D of this Schedule was amended. Though under item No. 1D(2), initially the rate of duty was fixed at 20% ad valorem, by Notification No. 50/76, dated March, the 16th, 1976, the same was reduced to 10%. In view of the amendment mentioned above, the appellants submitted another classification list again under the same erroneous assumption that Coca Cola and Fanta (Orange) contained blended flavouring concentrate falling under T.I. 1D(l)(a). This classification list was approved by the Assistant Collector on March 26, 1976 without drawing any sample for Coca Cola or Fanta (Orange). Now, it is the case of the appellants before us that as a matter of fact these beverages did not contain blended flavouring concentrate but only essence and that the classification list s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e was no limitation for claiming refund in case of levy or realisation of tax without the authority of law, as evident from the judgments of the Hon ble Supreme Court in the case of Aluminium Corporation of India v. Union of India (AIR-1975-S.C. 2279) = 1978 E.L.T. (3) 452 (S.C.) and Shivshankar Dal Mills v. State of Haryana (AIR-1980-S.C.-1037) and the judgment of Calcutta High Court in the case of Khardah v. Union of India (1980-Vol.I-Calcutta-Law Journal-433); (2) That even if some limitation is to apply, it is the limitation of three years as provided in Common Law or Contract Act read with Limitation Act, that would apply as is evident from the decisions in the cases of Messrs D. Cawasji Co. v. State of Mysore (AIR-1975-S.C.-813) = 1978 E.L.T. J154 (S.C.), M/s. Universal Drinks (P) Ltd. v. Union of India (1984 E.L.T. 207 to 15) and M/s. Vallabh Glass Works Ltd. v. Union of India [1984 (l6) E.L.T. 171]. In the instant case, the first judgment or order on the correct classification was delivered in the form of the Government of India s order-in-revision in the case of Krishna Bottlers and the appellants had filed their refund claim within 3 years of the discovery of the m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts has conceded that he would not press for the proposition that no law of limitation would apply to his case. He would principally seek the benefit of the second proposition of law of limitation namely the theory of the limitation of three years and would submit that the benefit of the same may be extended to him. In this view of the matter, we will examine his contentions in the same light. 3. Shri M.C. Thakur, the Ld. S.D.R., speaking for the Department submitted that it is a simple case of a refund claim barred by law of limitation. He submitted that the refund claim was filed on the 13th July, 1983 and by that time Section 11B had already come into existence. Therefore, Section 11B was the relevant provision and six months time-limit will apply. As the claim was admittedly filed after this period of limitation, therefore, it was correctly rejected as time-barred, In this connection, he would rely on an order of the Tribunal in the case of Collector of Central Excise, Patna v. Cyanides Pigments Ltd., Jamshedpur [1986 (6)-ECR-241] = 1986 (24) E.L.T. 89 (Tribunal). He would, in particular, draw attention to its para 21 in this regard where it has been held that the period o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nstitution which is the basic foundation for all taxing statutes, in the sense that it lays down a fundamental principle for levy and realisation of taxes. Perhaps, the point with reference to Article 265 was not urged before the Hon ble High Court. It also appears that perhaps, the Hon ble High Court s attention had not been drawn to the Supreme Court s judgment in the case of M/s. Shiv Shankar Dal Mills (Supra). It was his submission that he has cited a number of High Court and Supreme Court decisions with reference to the Common Law which laid down the principles which should govern the payment of refund in case of illegal realisation of any amount or excess amount and would earnestly urge this Tribunal to consider the matter in its wider perspective keeping in mind the well-defined principles of law governing collection of taxes and grant of refund of amount not due to the Government. Even otherwise, in cases where conflict of opinion is brought to the notice of the Tribunal, the Tribunal was at liberty to make up its own mind and was bound only by the orders and judgments of the Hon ble Supreme Court in terms of Article 141 of the Constitution. He would like to reiterate i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ose. In accordance with the doctrine of Lis it is, therefore, the law which was prevalent on this date which would apply. Hence it is immaterial on which date the refund claim was actually filed. What is material is the law in force on the date of discovery of mistake. Admittedly, Section 11B had not come into existence on this date and the only rule governing the refund of duty was Rule 11. The entire issue, therefore, boils down to the determination as to whether Rule 11 or the Common Law was applicable to the instant case. In this connection, we observe that Rule 11 was not a complete code and that is why apparently, while introducing Section 11B, the Government thought it fit to introduce a provision like Clause 5 under Section 11B. It is significant to note that whereas Rule 11 provides only for claims for refund of duty, Section 11B(5) also covers cases of refund of any amount collected as duty . In other words, the necessary implication is that the cases in which an amount is realised as duty illegally or without the authority of law or under a mistake of law, were not covered by Rule 11 (both before and after its amendment). This necessarily implies that there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s following this analogy has held the date of filing of refund claim was the relevant date. However, this case is distinguishable from the case before us inasmuch as the facts (reported in the Cyanides Pigments case) do not disclose a case of mistake of law by the assessee whereas in the instant case, the basic undisputed fact is that the payment was made under mistake of law. Obviously, therefore, neither Atma Steel s case nor the Cyanides Pigments case is at par with the present one. As these cases are distinguishable from the present one, both on facts and in law, the propositions laid down therein, cannot be applied to it. The present case, in fact, involves realisation of an amount without the authority of law and/or payment made under mistake of law. This type of situation is more appropriately governed by the case of M/s. Universal Drinks (P) Ltd. v. Union of India in which the issues involved are the same. In this case, it was observed, inter-alia, by the Hon ble High Court of Bombay [1984 E.L.T. (18) - Bom.. - 213 to 215]that - A bare reading of Rule 21, whether old or new, clearly negatives the construction that a substantive right to refund is created thereunder ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e he satisfies that he could learn about the same only at a later date. ...... The judgment of the Hon ble Court of Andhra Pradesh, Hyderabad in the case of Godavari Plywood s Ltd. v. Union of India and Others [1984 (18)-E.L.T.-732(A.P.)] cited by the Ld. S.D.R. is not relevant and not applicable to the facts of the present case as here the cause of action arose before Sec. 11B came into existence. The case of Inchek Tyres [1979-E.L.T.- (J 236)] cited by the Ld. S.D.R. is a Single Bench decision of 1979. Thereafter, the Calcutta High Court had occasion to examine the matter again in a Central Excise case and a Divisional bench of Hon ble Calcutta High Court held in the case of Khardah Company v. Union of India [1980 Vol. I-Calcutta Law Journal-433)] that it is a settled principle that the claim for refund of any amount realised without any authority of law; if not barred by any specific statutory provision; is enforceable in law. In this connection, a reference may also be made to the decision of Supreme Court in the case of Shiv Shankar Dal Mills (AIR-1980-S.C.-1037) wherein the Hon ble Supreme Court has stated that there is no law of limitation, especially for public bodie ..... X X X X Extracts X X X X X X X X Extracts X X X X
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