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TMI Blog2023 (3) TMI 1126X X X X Extracts X X X X X X X X Extracts X X X X ..... he amount when an erroneous refund is granted through the speaking order is reviewed under Section 35E of the Act? 2.1 The facts leading to the present appeal in nutshell are as under: 2.2 The respondent herein was at the relevant time a manufacturer of cotton yarn which it consumed captively in its composite mills for weaving of fabric. In October, 1980 vide judgment in the case of M/s. J.K. Cotton Spinning & Weaving Mills Company Ltd. vs. Union of India 1981 (8) ELT 887, the Delhi High Court held that removal of yarn which was consumed within the factory for production did not amount to removal within the meaning of Rules 9 & 49 of the erstwhile Central Excise Rules, 1944 and hence set aside the duty demand made on such captively consumed yarn. That the respondent company filed a revised classification list wherein, they declared that no duty was payable on the yarn captively consumed. By an order issued in April, 1981 the classification list was rejected by the Department and the respondent - company was directed to file a fresh classification list. The respondent - company filed a writ petition before the Delhi High Court being Writ Petition No.1190 of 1981 inter alia challen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y order dated 13.06.1996. Thereafter the respondent - assessee went in appeal before the Tribunal against the order of the Commissioner (Appeals). The Tribunal set aside the order passed by the Commissioner (Appeals) by order dated 15.05.2000 on the ground that there was no demand issued by the Department under Section 11A of the Central Excise Act. The Revenue challenged the order passed by the Commissioner (Appeals) dated 15.05.2000 which came to be dismissed by order dated 17.02.2005. In the meantime, since the company filed a refund claim it was found that the refund claim was not sustainable. A show cause notice dated 19.09.2000 was issued for deciding the issue of Section 11B of the Central Excise Act. Notice dated 19.09.2000 came to be adjudicated by the Deputy Commissioner of Central Excise who vide his order dated 21.12.2000 set aside the show cause notice and ordered refund of the entire amount to the respondent - assessee/company. The said order held that the amounts were paid under the protest by the party and therefore the time limit will not apply. The issue of unjust enrichment was not examined in the order. That thereafter the Revenue in exercise of powers conferred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the High Court. By the impugned judgment and order the High Court has dismissed the said appeal relying upon the decision of the Division Bench of the High Court in the case of Bajaj Auto Ltd. vs. UOI, 2003 (151) ELT-23 (Bom). At this stage it is required to be noted that before the High Court the Revenue strongly relied upon the decision of this Court in the case of Asian Paints (India) Ltd. vs. CCE, Bombay 2002 (142) ELT- 522 (SC) 2.6 Feeling aggrieved and dissatisfied with the impugned judgment and order passed by the High Court, the Revenue has preferred the present appeal. 3. Ms. Aishwarya Bhati, learned ASG and Ms. Ameyavikrama Thanvi, learned counsel have appeared on behalf of the appellant and Mr. V. Sridharan, learned Senior Advocate has appeared on behalf of the respondent. 4. Ms. Aishwarya Bhati, learned ASG appearing on behalf of the Revenue has vehemently submitted that in the facts and circumstances of the case the High Court has materially erred in relying upon the judgment of the Bombay High Court in the case of Bajaj Auto Ltd (supra) which was delivered on 15.02.2002. 4.1 It is submitted that before the High Court the Revenue heavily relied upon the decision o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the case of CCE, Chennai vs. Sha Harakchand Samanthmal, 2004 (177) ELT 990 (T). 4.4 It is further submitted by Ms. Bhati, learned ASG that as such the Tribunal has not at all considered the grounds on merits against the order passed by the O-I-O that the assessee shall be entitled to refund or not. It is submitted that as such number of grounds were raised before the Tribunal on the ground that the refund was not payable to the assessee including the unjust enrichment as envisaged in Section 11B of the Central Excise Act. It is submitted that question of unjust enrichment has not at all been examined by the Tribunal and the Tribunal only considered the grounds set out in the additional grounds which was by way of amendment/raising the additional grounds. 4.5 It is further submitted that neither the Tribunal nor even the High Court has considered the fact that while claiming the refund the assessee had claimed that the initial payment was under protest or while contesting the demand that the assessee took the stand that assessment was final and without notice under Section 11A amount cannot be recovered. It is submitted that however while claiming the refund the assessee claimed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s longer than the time limit prescribed under Section 11A, the show cause notice should precede the proceedings under Section 35E(2). 5.3 It is submitted that therefore the issue of show cause notice under Section 11A of the Central Excise Act is a condition precedent for recovery of the alleged erroneous refund within the normal period of limitation prescribed under Section 11A of the Act notwithstanding proceedings under Section 35E being initiated by the Revenue against the order granting refund. Making above submissions it is prayed to dismiss the present appeal. 6. We have heard learned counsel appearing on behalf of the respective parties at length. 7. The short question which is posed for consideration before this Court is whether Notice under Section 11A of the Central Excise Act is necessary for the recovery of the amount when the refund granted is reviewed under Section 35E of the Act and whether a separate notice under Section 11A of the Act to be issued within the time limit prescribed under Section 11A and before the proceedings under Section 35E of the Act are initiated and/or the notice under Section 11A of the Act shall precede the proceedings under Section 35E o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re under challenge. The Special Bench of the Tribunal took the view that Section 35E and Section 11A operate in different fields and are invoked for different purposes and different time limits are therefore set out therein. This Court in the case of Asian Paints (India) Ltd. (supra) specifically negated and/or did not accept the submission on behalf of the assessee that the recovery of excise duty cannot be made pursuant to an appeal filed invoking the provisions of Section 35E if the time limit under Section 11A has expired. 7.5 The law laid down by this Court in the case of Asian Paints (India) Ltd. (supra) as such was binding on the High Court and despite the same was pointed out and pressed into service by the Revenue before the High Court, the High Court has without giving any reasons how the same is misplaced has ignored to follow the decision of this Court in the case of Asian Paints (India) Ltd. (supra) and rather has followed its earlier decision in the case of Bajaj Auto Ltd (supra) which admittedly was prior to the decision of this Court in the case of Asian Paints (India) Ltd. (supra). 8. As observed hereinabove, once the order in original sanctioning the refund came ..... X X X X Extracts X X X X X X X X Extracts X X X X
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