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TMI Blog1991 (5) TMI 131X X X X Extracts X X X X X X X X Extracts X X X X ..... he said notification, became fully exempted from payment of duty. (2) with the enactment of Finance Bill, 1982, non-specified articles of plastics become classifiable under Tariff Item 68 and that they were continued to be exempted by virtue of Notification No. 182/82-C.E., dated 11-5-1982. (3) polyethylene and polypropylene bags are fully exempted from payment of excise duty w.e.f. 22-4-1982. The appellants had classified the goods under Tariff Item 68 and had paid duty at 8% ad valorem. The exemption Notification No. 283/82-C.E. exempting articles of plastic falling under Tariff Item 68 from payment of duty w.e.f. 11-5-1982 only. 3. A show cause notice dated 26-11-1985 was issued to the appellants to show cause as to why the refund claim should not be rejected as time-barred under Section 11B of the Act. 4. The appellants referred to the order of Collector (Appeals) dated 4-2-1985 and submitted that in view of the said order, the refund would be payable. 5. The Assistant Collector in the order-in-original has observed that the order-in-appeal dated 4-2-1985 passed by Collector (Appeals) Bombay pertained to the classification list filed by the appellants in res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had allowed the appeal of the assessee by order dated 4-2-1985 and had directed the Assistant Collector to grant refund which were admissible under law and therefore, the Asstt. Collector was bound by that order and he could not have rejected the part refund claim when appeal had been decided in their favour. Shri R.K. Jain, relied on the following rulings - (1) In Re : Bijlee Products India Pvt. Ltd. - 1982 (10) E.L.T. 591 (GOI) (2) Collector of Central Excise v. Stewards Lloyds of India Ltd., Calcutta - 1985 (22) E.L.T. 522 (3) Modi Rayon Silk Mills v. Collector of Central Excise - 1988 (34) E.L.T. 321 (4) Alpha Electric Products v. Collector of C. Ex., Calcutta - 1987 (30) E.L.T. 752 (5) Britannia India Ltd. v. Collector of C. Excise, Calcutta - 1987 (31) E.L.T. 985 He fairly brought to our notice a few citations which were contrary to the views expressed in the above rulings and submitted that this Bench should pronounce a correct view by referring the matter to a Larger Bench for a decision : (1) Aditya Mills Ltd. v. Collector of Central Excise, Jaipur - 1983 (14) E.L.T. 1853 (2) Collector of Central Excise, Thane v. Indian Dyestuff ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed order-in-original dated 24-4-1986 has held that on the facts and circumstances of the case, the refund has arisen only under Notification No. 182/82 dated 11-5-1982 which envisage exemption for goods falling under T.I. 68 of CET and applicable from 11-5-1982 and therefore, has granted refund from this date and rejected for the earlier period. The Collector (Appeals) by the impugned order dated 18-3-1987 has upheld the findings of the Asstt. Collector. We do not see any infirmity in the order. The appellants having not get the goods classified under T.I. 15A(2) of CET nor having challenged the classification and also having not paid the duty under protest, therefore, cannot now raise reclassification of goods retrospectively and seek refund of duty pertaining to that period. The payment of duty under Rule 9B on provisional assessment of duty or under Rule 173B or under Rule 233B of the Rules are independent and are self-contained provision independent of Sec. 11B of the Act. There is a saving clause under sub-rule (4) of Section 11B which states (4) Save as otherwise provided by or under this Act, no claim for refund of any duty of excise shall be entertained. As such, the clai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the final orders approving the classification by the Assistant Collector or not, there is a definite nexus between the protests earlier lodged and the one dated 6-7-1979. There is also force in the respondent s plea that they were compelled to file the classification lists and pay the duty, now in issue. As far as the law is concerned Section 173B(3) contains a clear provision for payment of duty under protest at the rates approved by the officer and sub-rule (5) stipulates that when the dispute about the duty has been finalised, the proper officer shall make such modification and inform the assessee accordingly. By Rule 173J, in force prior to 1980, Rule 11 was applicable to refunds. This provides that an application for refund should be made within 6 months from the date of payment of duty and since 1977, also provided that this limitation shall not apply where any duty has been paid under protest. This latter provision only expressly made clear a principle that a protest lodged simultaneously with payment of duty was tantamount to claiming a refund. The department has not adduced any proof that the Superintendent or the A.C. or the Collector had rejected the protest made in 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eclaration in the price lists filed. The approval of price lists and the assessments had become final not having been appealed against. An application for refund, if allowed, will be directly inconsistent and conflicting with the orders in assessments which had become final and cannot, therefore, be sustained. In Modi Rayon Silk Mills v. CCE, Meerut (supra), the findings of the majority of the Bench at Paras 74 to 85 is reproduced below, which ratio fully applies to the facts of this case - The purpose of Rules 173B and 173C, in the context of self assessment and self removal, is obvious that questions relating to classification and valuation of goods proposed to be cleared should be determined in advance by the proper officer, so that thereafter, the assessee may proceed to clear his goods on his own, subject to submission of the prescribed returns. It is also a fact of which the Bench can take notice that if the declaration of rate of duty or value in a classification list or price list is not approved as claimed by the assessee, latter is free to go up in appeal against that decision. It is also a fact of which notice can be taken that the R.T. 12 returns furnished by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iming refund of duty. That section specifically provides that it is the Assistant Collector of Central Excise to whom the refund claim should be addressed. It also makes it the duty of the Assistant Collector to order a refund, if he is satisfied that one should be made. Now a classification list or price list is ordinarily approved at the level of an Assistant Collector; on occasion it may be approved at the level of the Deputy Collector or even the Collector. It could hardly have been the intention of the legislature that an Assistant Collector in the course of considering a refund claim, should be able in effect to sit in appeal over a decision (on the classification lists or price lists) of his Collector. This difficulty would remain even if such a refund claim were to be referred upwards to the Deputy Collector or the Collector. The position that emerges is that an assessee who does not agree with a decision on a classification list or a price list can challenge it directly by appealing against that decision and now indirectly by filing a refund claim on an assessment based on that decision. In taking this view it will be seen that no provision of Central Excises and Salt Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... read out the relevant portions of these decisions. The reference to the Tribunal s decision in the case of M/s. Pure Drinks, Calcutta does not appear to be correctly cited, since the two orders bearing the Nos. given relate to some other parties and bear dates other than 26-2-1985. I have however, seen the Tribunal s decision in the case of Sirpur Paper Mills. On a careful consideration, it appears that the decision there was given with reference to the facts of that particular case, the important fact being that even to begin with the assessee protested against the action of the Assistant Collector in changing the classification of the goods in question. It is difficult to derive from this order a categorical enunciation of the principle that a claim for refund would lie even in a case where there was not merely no protest against the Assistant Collector s decision on the price list, but the price list was approved by the Assistant Collector without any modification. The order of a two Member Bench of the Tribunal in another batch of cases of the present appellants in which the above cases find mention, does not contain any independent discussion of issue and therefore, does not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent that the respondent is entitled to the benefit of the notification in question and that the refund was not granted on the ground the respondent herein did hot make a specific claim of the said notification in the classification list filed. This argument of the learned DR cannot be acceded to. The ruling of the Special Bench in Delhi Chemicals case comprising three learned Members, was rendered on 27th June, 1988, where an identical issue arose for consideration that was also a case where the refund claim of the party was rejected on the ground that the party had not made a claim for the benefit of Notification No. 80/80 in their classification. The Special Bench held in that case as under - We have carefully considered the submissions of both the sides. In the case of Ceat Tyres (supra), the Bombay High Court has held, in the context of Section 72 of the Indian Contract Act, that the department cannot be allowed to take advantage of the mistake committed by the petitioner in paying a higher amount to the departmental and the department cannot be allowed to retain any such amount which it would not have received but for the mistake on the part of the petitioner in paying it in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he appeal." 14. In view of this finding of the Calcutta High Court regarding the Modi Rayon s case and also of view of S.R.B., the matter requires reconsideration before Larger Bench of Five Members and we recommend the President to constitute the same to decide on this issue in the light of the decision of Calcutta High Court s decision in I. T. C. case and that of S.R.B. s ruling in Mysore Acetate Chemical Co. s case being in conflicting earlier ratio of Tribunal rendered in Modi Rayon s case followed in other cases also. The Registry shall place these papers before the President for appropriate orders. 15. [Order per: K.S. Venkataramani, Member (T)]. -I have had the benefit of carefully going through the order of Hon ble Member (Judicial), Sh. S.L. Peeran and I may express the following views : 16. The appellants claim for refund of duty from 11-5-1982 under Notification 182/82 has already been granted and the dispute is regarding the period prior to it. During that period, even according to the appellants, they had not disputed classification of the goods under Item 68 CET. The appellants claim for refund for the prior period is on the ground that they are covered ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roved price list. The High Court rejected on the question of limitation. The significance is that the dismissal was not on the ground that there has been no appeal against the order of approval of the price list. Therefore, admittedly, while the decisions of the Tribunal on this issue are not uniform, in view of the High Court decisions, being those of a higher judicial body, in my humble opinion, these High Court decisions may have to be followed until there is a ruling by the Supreme Court in the matter in future. In this context, it may also be recalled that the Supreme Court decision in the case of Elson Machines - 1988 (38) E.L.T. 571 in which the Supreme Court observed that the Department was not barred from taking a different view on classification after having approved the classification list, has further been affirmed by the Supreme Court in the case of Plasmac Machines Mfg. Co. v. Collector of Central Excise, Bombay -1991 (51) E.L.T. 161 (SC) = 1991 (32) ECR 1 wherein the Supreme Court observed as follows: The appellants contention that the department having earlier approved the classification of Tie Bar Nuts under Tariff Item 68 has no justification for its revision ..... X X X X Extracts X X X X X X X X Extracts X X X X
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