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TMI Blog2010 (8) TMI 788X X X X Extracts X X X X X X X X Extracts X X X X ..... pplication was barred by limitation under Section 11B of the Central Excise Act, 1944 (hereinafter referred to as the Act ) and the appellant had not followed the procedure of payment of duty under protest in terms of Rule 233B of erstwhile Central Excise Rules 1944. But the appellant s grievance was that the amount of Rs. 4,12,590/- deposited by it became due to be refunded when show cause notice No. CE-20/Mahalaxmi/SCN/R-23/MOD V/01/Pt/611 dated 27-9-01 was struck down in terms of Order-in-Original No. 42/04-05 dated 23-6-2004. Accordingly, refund application dated 8-9-2005 made was well within one year from the date of Order in Original as required under Section 11B of the Act. 3. When the matter stood as above, against the order of rejection of refund the appellant came in appeal before Tribunal and such appeal was registered as appeal case No. E/1130/2007. While disposing such appeal, Tribunal recorded the fact that rejection of the claim was done by the learned Appellate Authority on the ground that duty was paid during the period 22nd February, 1999 to 28th August, 1999, while the refund claim was filed on 8-9-2005 which was after a period of one year for which that was b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... argue that non-consideration of the factual aspect of the refund is an apparent mistake and rectifiable. He further placed reliance on the decision of Tata Engg. Locomotive Co. Ltd. v. Commr. of C. Ex., Jamshedpur reported in 2007 (218) E.L.T. 644 (S.C.) to submit that there is no finding against the appellant that the amount was paid towards duty for which the wrong conception of Tribunal about refund of duty should not make the appellant to suffer. 7. Ld. Counsel further relied on the decision of Hindustan Lever Ltd. v. Commissioner of C. Ex., Mumbai-I reported in 2006 (202) E.L.T. 177 (Tri.-LB) = 2008 (10) S.T.R. 91 (Tribunal-LB) and submitted that when the law was pronounced in Mafatlal Industries case (supra) wrong consideration of the same shall be rectifiable mistake. He also submitted that taking into consideration the judgment of Hon ble High Court of Bombay in the case of Stanlek Engineering Pvt. Ltd. v. Commissioner of C. Ex., Mumbai-II reported in 2008 (229) E.L.T. 61 (Bom.) = 2009 (16) S.T.R. 682 (Bom.), it may be held that non-consideration of the citation gives rise to rectifiable mistake. It was further relied upon by the ld. Counsel on the decision of the Trib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n para-2. In para 3 of the order, it has been recorded that the appellant relied on para 69 of the Apex Court judgment in Mafatlal Industries case - 1997 (89) E.L.T. 247 (S.C.) to argue that the amount in question was paid during investigation and that is to be treated as deposit and not duty, for which the refund application is not barred by limitation. There was no elaborate argument made by appellant how its case is covered by the ratio of Apex Court judgment in Mafatlal case. Nothing is apparent to have been argued or submitted by the appellant to bring to the notice of the Bench about the law laid down by para 69 of the judgment in Mafatlal case and the manner how case of the appellant was covered by the same. 11. Judgment in Mafatlal s case (supra) being on the constitutionality of the levy. It has been held that a levy if found unconstitutional is not leviable and any collection of tax made under a wrong notion or conception of law declared unconstitutional, becomes refundable. But the case of the appellant is that a suo-motu deposit was made by it towards duty without any formal protest to get rid of the adjudication apprehended by him. It is common knowledge that no one ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e very concept of economic justice means and demands that unless the claimant (for refund) establishes that he has not passed on the burden of the duty/tax to others, he has no just claim for refund. It would be a parody of economic justice to refund the duty to a claimant who has already collected the said amount from his buyers. The refund should really be made to the persons who have actually borne its burden - that would be economic justice. Conferring an unwarranted and unmerited monetary benefit upon an individual is the very anti-thesis of the concept of economic justice and the principles underlying Articles 38 and 39. Now, the right to refund arising as a result of declaration of unconstitutionality of a provision of the enactment can also be looked at as a statutory right of restitution. It can be said in such a case that the tax paid has been paid under a mistake of law which mistake of law was discovered by the manufacturer/assessee on the declaration of invalidity of the provision by the court. Section 72 of the Contract Act may be attracted to such a case and a claim for refund of tax on this score can be maintained with reference to Section 72. This too, however, doe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eposited by the appellant voluntarily towards duty of excise consequent to the audit objections. There was no averment by Appellant justifying claim of refund in the course of appeal hearing since nothing comes out from the order sought to be amended. Appellate order was passed indicating reason in para 4 thereof which has been summarised herein before. All these aspects come to surface only when a detailed exercise as aforesaid is carried out. 15. In order to amend an order under the powers of rectification of mistake conferred on the Tribunal by law the mistake should be apparent from record and appreciable without a detailed exercise for discovery thereof. Depicting of the facts aforesaid clearly shows that detailed exercise is called for by the Appellant to appreciate the facts and circumstances of the case. Such exercise is permissible only if an appeal is decided or power of review is conferred on the Tribunal. But such a power is absent in the scheme of the law of Excise. 16. It is of course not easy to define or adequately describe what is a mistake apparent from record. But what that can be rectified is to be appreciable by a cursory glance to the order and should be a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mistake in the order sought to be rectified. The mistake to be rectified must be one apparent from the record. A decision on a debatable point of law or a disputed question of fact is not a mistake apparent from the record. 18. Apparent means visible; capable of being seen, obvious; plain. It means open to view, visible, evident, appears, appearing as real and true, conspicuous, manifest, obvious, seeming. The plain meaning of the word apparent is that it must be some thing which appears to be so ex facie and it is incapable of argument or debate. It, therefore, follows that a decision on a debatable point of law or fact or failure to apply the law to a set of facts which remains to be investigated cannot be corrected by way of rectifications. A mistake which can be rectified under Section 35C(2) of the Act is one which is patent, which is obvious and whose discovery is not dependent on argument or elaboration. Rectification of an order does not mean obliteration of the order originally passed and its substitution by a new order. What the Appellant intends to do in the present case is precisely the substitution of the order which according to law is not permissible under th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... because in the process of arriving at the final decision, reliance was placed on some material which could not have been used it can never be said that in the final decision there is a mistake apparent from the record. This is because the final opinion could also have been based on the other material which was relevant and which could be used. 21. In the case of Poothundu Plantation P. Ltd. v. Agricultural ITO, Chittoor - 2004 (178) E.L.T. 16 (S.C.) in Para 4 it has been held that it is well-settled that if Hon ble Supreme Court has construed the meaning of a section, then any decision to the contrary given by any other authority must be held to be erroneous and such error must be treated as an error apparent on the record. In the case of Commissioner of Central Excise, Mumbai v. Bharat Bijlee Limited - 2006 (198) E.L.T. 489 (S.C.) it has been held that failure to take into consideration the material evidence which was present on the record, would certainly amount to mistake apparent on the face of the record and the Tribunal under the circumstances would have the jurisdiction to correct the said mistake in exercise of its powers under Section 35C(2) of the Act. But in the prese ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as pointed out to the Tribunal that the judgment of the coordinate bench was placed before the Tribunal when the original order came to be passed but it had committed a mistake in not considering the material which was already on record. The Tribunal has acknowledged its mistake; it has accordingly rectified its order. Accordingly it was held by the Apex Court that the High Court was not justified in interfering with the said order. But in the present case, Tribunal examining record and noticing material fact recorded by lower appellate authority and applying statutory provisions of Section 11B of the Act, came to the conclusion as recorded in para 4 of the order and while arriving at such decision, appellants reliance on Mafatlal s case (supra) does not appear to have escaped notice of the Tribunal. 23. Following the ratio laid down by Hon ble Supreme Court in Deva Metal Powders Pvt. Ltd. v. Commissioner of Trade Tax, U.P it may be stated that an error apparent on the face of the record for acquiring jurisdiction to effect rectification must be such an error which may strike one on a mere looking at the record and would not require any long drawn process of reasoning. The follo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are not possible. Neither of them postulate a rehearing of the dispute because a party had not highlighted all the aspects of the case or could perhaps have argued them more forcefully and/or cited binding precedents to the Court and thereby enjoyed a favourable verdict. This is amply evident from the explanation in Rule 1 of the Order XLVII which states that the fact that the decision on a question of law on which the judgment of the Court is based has been reversed or modified by the subsequent decision of a superior Court in any other case, shall not be a ground for the review of such judgment. Where the order in question is appealable the aggrieved party has adequate and efficacious remedy and the Court should exercise the power to review its order with the greatest circumspection. This Court in M/s. Thungabhadra Industries Ltd. (in all the Appeals) v. The Government of Andhra Pradesh represented by the Deputy Commissioner of Commercial Taxes, Anantapur [AIR 1964 SC 1372] held as follows : There is a distinction which is real, though it might not always be capable of exposition, between a mere erroneous decision and a decision which could be characterized as vitiated by err ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arded as forming part of the record for the purpose of examination under Section 154(1) of the Act. On the facts of this case, the order of assessment for the immediately preceding year which was rectified was undoubtedly a part of the record which was available for examination by the Income-tax Officer for the purpose of deciding as to whether there was a mistake apparent on the face of the record in the order of assessment for the immediately succeeding year, namely, the assessment year 1974-75. It was also view of the Hon ble Court that the record for the purpose of Section 154(1) is the record available to the authorities at the time of initiation of proceedings for rectification and not merely the record of the original proceeding sought to be rectified. But the appellant in the present case has failed to bring its case to the four of the judgment. 28. Justice demands that no mistake to perpetuate or persist on record and rectification thereof is sine qua non. To fulfil mandatory provisions of law to what extent an order shall undergo amendment is immaterial following the principles of law laid down by the Hon ble High Court of Bombay in Blue State Co. (Bom.) Pvt. Ltd. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the material fact and recorded in para 2 of the appeal order, there is no scope for amendment in the present case. 30. In CIT v. Vichitra Constructions (P) Ltd. - 264 ITR 371 (Del), Hon ble Court at Page 373-374 of the reported judgment it has been held that clearly, if there is a mistake then an amendment is required to be carried out in the original order to correct that particular mistake. The provision does not indicate that the Tribunal can recall the entire order and pass a fresh decision. That would amount to a review of the entire order and that is not permissible under the Income-tax Act. Reference was made by Hon ble court in the case of Ms. Deeksha Suri v. ITAT [1998] 232 ITR 395. At page 415, was made and the court pointed out as under : Could any relief have been allowed to the petitioners in exercise of jurisdiction conferred by Section 254(2) of the Act amending the order passed by the Tribunal with a view to rectify any mistake apparent from the record? The language of the provisions is clear. The foundation for exercising the jurisdiction is with a view to rectify any mistake apparent on the record and the object is achieved by amending any order passed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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