2008 (12) TMI 193

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..... of staple fibre yarn during the period November 1996 to January 1997. 2. The facts of the case are that the assessee manufactures cotton yarn, staple fibre yarn etc. and clears to its sister unit for weaving into fabrics. For payment of duty on such removals of staple fibre yarn etc. the assessee adopts the price charged for sale of such goods to unrelated buyers. The assessee paid duty on removals of staple fibre yarn during the material period adopting a price of Rs. 137/- per kg. Subsequently they discovered that they had adopted Rs. 137/- erroneously and that Rs. 137/- was a cum-duty unit price which had prevailed at an earlier point of time. They ascertained the assessable value adopted for sale of such yarn to independent buyers just .....

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..... ied on the judgment of the Apex Court in Mahabir Kishore case reported in 1989 (43) E.L.T. 205 (S.C.) and judgment in New India Industries Ltd. case reported in 1990 (46) E.L.T. 23 (Bom.) wherein it was held that duty paid under mistake of law was liable to be refunded. In the second cited case it was held that the excess duty was liable to be refunded even if the same had been recovered from the customers by the manufacturer. 3. In the appeal filed by the revenue it is contended that the invoices relied on by the assessee to show that the assessable value to be adopted bore dates different from those of invoices which covered the impugned clearances. The assessee could not claim refund on the basis that they had adopted a wrong price for .....

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..... sister unit was Rule 8 of Central Excise Valuation Rules, 2000. The lower appellate authority wrongly relied on case law which laid down that refund of duty paid by mistake of law was not governed by Section 11B of the Act and ordered refund of the impugned amount. We find that the case law do not apply to the facts of the case. Also, Commissioner (Appeals) has not examined if the value could be revised retrospectively and refund of excess duty paid could be validly claimed after the clearance of excisable goods. In the circumstances we set as the impugned order and allow the appeal filed by the Revenue by way of remand. The Commissioner (Appeals) shall decide the dispute afresh. Needless to say that the assessee shall be afforded an effec .....

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