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TMI Blog2024 (6) TMI 1417X X X X Extracts X X X X X X X X Extracts X X X X ..... eas Ltd. Vs. CCE, Panchkula [ 2018 (4) TMI 910 - CESTAT CHANDIGARH ] , whereby the refund claim filed by the appellant is time barred. HELD THAT:- Aanalysis of the relevant provisions of the OIDC Act, 1974, it is clear that the cess has been collected as duties of excise and the provisions of Central Excises and Salt Act, 1944 and the rules made thereunder; particularly the provisions relating to refunds and exemptions from duties have been made applicable. Also, the EC and SHEC levied under the relevant provisions specifically refers to provisions of the Central Excise Act, 1944 relating to refunds, exemptions and imposition of penalty etc. for its administration. The appellant had discharged EC and SHEC on Oil cess, considering it as duties of excise. Subsequently, applying the circular dated 07.01.2014 issued by the Board, wherein it is clarified that EC and SHEC be payable only on the cess which is administered and collected by Ministry of Financs it is realized by the Appellant that OIDC being administered by the Ministry of Petroleum and only collected by the Ministry of Finance; EC and SHEC are accordingly not payable. Thus, admittedly all these years, the EC and SHEC has be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ise of its extraordinary jurisdiction conferred under Art. 226 or Art.32 of the Constitution, as the case may be. (i) the refund claim of EC and SHEC paid on OID cess, being an illegal levy is governed by the principle laid down in para 99(i) of the judgment of the Hon'ble Apex Court in Mafatlal Industries Ltd. s case and the Larger Bench judgment in Veer Overseas Ltd. s case; accordingly the claim have to be filed under Section 11B of the Central Excise Act, 1944 and governed by the said provisions prescribed thereunder. (i) On the second question, the judgment delivered by Hon'ble High Courts in Joshi Technologies case in exercise of Jurisdiction under Article 226 followed in 3E Infotec s case cannot be applied by the departmental authorities and Tribunal in case of refund of illegal levy in view of the principle of law laid down by the Larger Bench of Tribunal in Veer Overseas Ltd. s case. Majority order - The Third Member has agreed with the view of Member (Technical) that the refund claim is time barred. In view thereof, the impugned order is upheld. The appeal is dismissed. - Hon'ble Ms. Sulekha Beevi C.S., Member (Judicial) And Hon'ble Mr. M. Ajit Kumar, Me ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (1) of the Oil Industry (Development) Act,1974 (OID Act, for short), Educational Cess (EC), Secondary and Higher Education (SHEC) etc. are to be borne by the appellant. 2.3 Ld. Counsel submitted that among other things, the appellant has to pay following taxes and duties on sale of crude oil sold to CPCL : (a) VAT/Central Sales Tax payable under the Sales Tax Laws of the State; (b) National Calamity Contingent Duty levied under Section 126 (1) of the Finance Act, 2001. (c) Oil Industry Development Cess (OID Cess) levied in terms of Section 15 (1) of the Oil Industry (Development) Act, 1974 and collected by the Department of Revenue. 2.4 Ld. Counsel explained that in terms of Section 91 93 of the Finance No. (2) of the Act, 2004, Education Cess is levied and collected by the Department of Revenue on the aggregate of all duties of excise. Similarly, in terms of Section 126 and 138 of the Finance Act, 2007, Secondary and Higher Education Cess is levied and collected by the Department of Revenue on the aggregate of all duties of excise. 2.5 OID Cess is levied by the Ministry of Petroleum Natural Gas but administered and collected by the Department of Revenue, Ministry of Finance. Sinc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 20 (1) TMI 324 -CESTAT NEW DELHI (iv) CCE Bangalore Vs KVR- Construction - 2012 (26) STR 195 (Kar.) 4. On identical set of facts, the Hon ble High Court of Gujarat in the case of Joshi Technologies International Vs UO - 2016 (339) ELT 577 (Guj.) held that for the refund of amount paid under mistake of law the provisions of Section 11B and 11BB would not apply. The Hon be High Court observed that the amount so collected cannot be retained by the Government in terms of Article 265 of the Constitution of India. The time limit prescribed under the Limitation Act, 1963, if considered, the period has to be computed from the date when the mistake was discovered in terms of Section 17 of the Limitation Act, 1963 and then the refund claim would be well within time. The decision in the case of Joshi Technologies International (supra) was followed by the Hon'ble High Court of Gujarat in the appellant's own case as reported in ONGC v UOI -2017 (354) ELT 577 (Guj.) wherein the issue was refund of the OID cess itself. 5. The Ld. Counsel submitted that appellant was under bonafide belief that EC and SHEC were liable to be paid on OID Cess also. Only after the clarification of CBEC vide Ci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has not been passed on to the customers or any other person (d) Letter of the Chairman Managing Director of the appellant dated 21.03.2012 addressed to the Secretary to the Government of India, Ministry of Petroleum and Natural Gas, clearly stating that OID Cess is not recoverable from their customers. 8. Ld. Counsel submitted that appellant had provided adequate evidence to prove that the burden of the EC and SHEC on OID Cess has not been passed on to the customers. However, the authorities below have totally ignored the above documentary evidences and wrongly concluded that the appellant has not produced the evidence to prove that the burden of EC SHEC was borne by them. 9. In the impugned order, it is also stated that appellant has not submitted its financial records such as balance sheet, trial balance etc. to prove that they have borne the burden of EC and SHEC on OID Cess. 10. Ld. Counsel submitted that non-production of financial records does not ipso facto prove unjust enrichment when other corroborative evidences are produced to prove that the duty burden has not been passed on. To prove this argument, Ld. Counsel relied on the decision of the Tribunal in the case of JK Ty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, the authorities below have rightly rejected the claim both on the ground of limitation as well as on the bar of unjust of enrichment. Ld. A.R prayed that the appeal may be dismissed. 14. Heard both sides. 15. The issue that arises for consideration is whether the appellants are eligible for the refund of Education Cess (EC) and Secondary Higher Education Cess (SHEC) paid on OID Cess OR whether the refund claim is hit by limitation and bar of unjust enrichment. 16. The period involved is from 2004 to 2013. Refund claim has been filed on 04.02.2014. First ground for rejection of refund is that the claim is time-barred. It is the case of department that CBEC had issued earlier letter dt. 10.08.2004 whereby it was clarified the situations in which Education Cess and Secondary Higher Education Cess is not required to be paid. The Ld. Counsel for appellant has countered this allegation by submitting that the letter date 10.08.2004 issued by CBEC did not clarify regarding payment of EC and SHEC on OID Cess which is not levied by Department of Revenue. The letter only clarified that EC and SHEC are not payable on duties of excise not collected by Department of Revenue. The said letter o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... levied under an Act which is administered by different departments such as Sugar Cess levied under Sugar Cess Act, 1982, Tea Cess levied under Tea Act, 1953 etc. 3. The matter has been examined. A cess levied under an Act which is not administered by Ministry of Finance (Department of Revenue) but only collected by Department of Revenue under the provisions of that Act cannot be treated as a duty which is both levied and collected by the Department of Revenue. 4. It is, therefore, reiterated that the Education Cess and the Secondary and Higher Education Cess are not to be calculated on cesses which are levied under Acts administered by Department/Ministries other than Ministry of Finance (Department of Revenue) but are only collected by the Department of Revenue in terms of those Acts. 19. It is evident that only by circular dated 07.01.2014 the Board has expressly clarified that Education Cess and Secondary Higher Education Cess are not to be collected on Cesses which are levied under other Acts but are only collected by the Department of Revenue in terms of those Acts. The appellant has filed the refund claim immediately after the issuance of the said circular. 20. Ld. Counsel h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... relevant date. 5. In the refund order, the Assistant Commissioner allowed the refund of Rs. 5,32,777/- and disallowed the refund claim of Rs. 4,39,683/- on the ground that it was barred by limitation. 6. Aggrieved by this order, the Assessee filed an appeal to the Commissioner of Central Excise (Appeals-I), who affirmed the order of The Assistant Commissioner that the claim of the Assessee was barred By limitation, and dismissed the appeal. 7. The Assessee approached the Customs Excise Service Tax Appellant Tribunal, against the order of the Commissioner. The Tribunal took the view, that it had an obligation to act within the four Corners of law, and found no justification to condone the delay in Making the application for making a refund, and rejected the appeal. 11. A similar view has been taken by the Bombay High Court in the case of Parijat Construction v. Commissioner Excise, Nashik, reported in 2018 (359) E.L.T. 113 (Bom.), where the Bombay High Court has held as under :- 4. Weare of the view that the issue as to whether limitation prescribed under Section 11B of the said Act applies to a refund claimed in respect of service tax paid under a mistake of law is no longer res in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Revenue is allowed to keep the excess service tax paid, it would not be proper, and against the tenets of Article 265 of the Constitution of India. On the facts and circumstances of this case, we deem it appropriate to pass the following directions : - (a) The Application under Section 11B cannot be rejected on the ground that is barred by limitation, provided for under Section. (b) The claim for return of money must be considered by the authorities. 22. The Co-ordinate Bench of the Tribunal in the case of Oriental Insurance Co. Ltd. Vs CCE ST New Delhi - 2020 (1) TMI 324 CESTAT NEW DELHI had occasion to consider a similar issue. In the said case, a notification dated 01.03.2011 was issued exempting taxable service specified under Section 65 (105) (d) of the Finance Act, 1994 from the whole of service tax leviable thereon under Section 66 of the Act. The assessee therein paid service tax between March 2011 and November 2011 and they filed refund claim on 23.12.2013. The order passed by the authorities below rejecting the refund claim as time-barred was set aside by the Tribunal, following the decision of the Madras High Court in the case of 3E Infotech (supra) and held that when se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ived. The fact that despite there being no liability on the part of the petitioner to pay Education Cess and Secondary and Higher Secondary Education Cess, it has paid the same from July, 2004 to April, 2014, on the face of its shows that the same was by way of a mistake. As regards the contention that the self assessment having become final, it is not open for the petitioner to claim refund, the adjudicating authority, in the impugned order has held thus : No refund claim can be filed directly on the basis of C.B.E. C. Circular dated 7-1-2014, before the pending assessment is finalised. Accordingly, for claiming any refund for the period from July, 2004 to April, 2014, on the basis of C.B.E. C. circular dated 7-1-2014, the essential pre-condition is to first finalise the pending assessment, only then the question of any refund would arise. On verification of records, it is observed that the claimant has already self-assessed and paid the duty under Rule 6 of the CER, 2002 for the period July, 2004 to April, 2014 which is deemed to be final assessment. Hence the question of finalisation of the same does not arise. For the purpose of claiming any refund on the basis of C.B.E. C. cir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... extent, with no order as to costs. 21. At this stage, Mr. R.J. Oza, learned Senior Standing Counsel for the respondents has requested that the operation of the judgment be stayed for a period of six weeks from today. The said request is strongly opposed by Mr. Harsh Parekh, learned advocate for the petitioners. 22. Having regard to the facts and circumstances of the case, the request is declined. 24. Applying the ratio of decisions (supra), we are of the considered opinion that the refund claim cannot be rejected on the ground of limitation. The issue on limitation is held in favour of the assessee, and against the Revenue. 25. The second issue is with regard to bar of unjust enrichment. The appellant has produced the documents as already stated in para-7 of this order. The Department has held that the appellant has not furnished the balance sheet and trial balance and therefore has not passed the test of unjust enrichment. Ld. Counsel for appellant has submitted that they have produced the necessary documentary evidences to establish that the duty element has not been passed on to the buyer. We proceed to examine this contention. 26. On perusal of the agreement, it is seen that Sc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion from us. 29. A certificate by the Chartered Accountant is also furnished. Relevant part reads as under : This is to further certify that the above stated refund claimed of Education Cess and Secondary Education Cess paid by ONGC has been borne by it and the incidence/burden of the Education Cess and Secondary Education Cess paid has not been passed on to the customer(s) or any other person. Also as per the relevant Article read with Schedule-B of respective Crude Oil Sale Agreement entered with IOCL, BPCL, HPCL, CPCL MRPL, Education Cess and Secondary Education Cess on OID Cess is to be borne by ONGC, hence passing of the incidence of Education Cess and Secondary Higher Education Cess of the OID Cess by ONGC to any other person does not arise. This Certificate has been issued on the basis of he information, explanations given, documents produced and accounting records of ONGC. This certificate has been issued for onward submission to the Commissioner of Central Excise Service Tax-Tiruchirapalli, in support of refund claim of deposit of Education Cess and Secondary Education Cess on OID Cess. This certificate should not be used other than intended purpose without obtaining writ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mber 2013 was sought as refund under Section 11B of Central Excise Act, 1944. The refund application was filed on the basis of the very same CBEC circular dated 07.01.2014. In para-11 of the Order-in-Appeal, the Commissioner (Appeals) has observed that the price has been remained same even after the hike of OID cess and that this proves that burden of OID cess is not passed on to the buyer. The said para reads as under : 11. The rate of OID has been increased from 2,500/MT to Rs.4,500/MT w.e.f 17.03.2012. The appellant submitted two invoices for Crude Oil supplied to IOCL refinery for prior to 17.03.2012 and after 17.03.2012. On going through these two invoices, | find that there is no change in price of Crude Oil even after the increase of the rate of OID Cess from 2,500/MT to Rs.4,500/MT which proves the burden of OID Cess is not passed on to the buyer refineries and hence the question of passing on the burden of EC SHEC to the buyer does not arise. 33. The Commissioner (Appeals) Guwahati, after considering the issue of limitation as well as the issue of unjust enrichment, has ordered for sanction of the refund of EC SHEC paid on OID Cess by the appellant s sister concern. We the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ies International (supra) and in the appellant s own case, we are of the considered view that the rejection of refund on the ground of limitation and unjust enrichment is not justified. We hold that the appellant is eligible for refund. 37. In the result, the impugned order is set aside. Appeal is allowed with consequential relief, if any. (pronounced in open court on 06-07-2023 Separate Order (Sd/-) (M. AJIT KUMAR) (SULEKHA BEEVI C.S.) Member (Technical) Member (Judicial) PER CONTRA M. AJIT KUMAR ORDER DATED 06-07-2023 38. 1 have perused the order prepared by my learned Sister Ms. Sulekha Beevi C.S., Member (Judicial). Three issues have been taken up by her for consideration as below:- i) whether the appellant is eligible for the refund of Educational Cess and Secondary Higher Educational Cess paid on Oil Industry Development Cess for the period from July 2004 to December 2013. ii) whether the refund claim is hit by the bar of unjust enrichment. iii) whether the refund is hit by limitation under Section 11B of the Central Excise Act 1944. After examining the facts and evidences related to the three issues above, she was of the considered view that; i) the appellant is eligible for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gment of the Hon'ble Supreme Court in Mafatlal industries Ltd Vs Union of India [1997 (89) E.L.T. 247 (S.C.)] to hold that the refund was also hit by merits and the doctrine of unjust enrichment. Aggrieved by the said order the appellant approached the Commissioner (Appeals), who after examining a number of judgment including the Supreme Court's judgment in Mafatlal industries Ltd. (supra) rejected the appeal under section 11B of the CE Act on merit, time bar and unjust enrichment. The appellant is hence before us. 40. The issue on merits and unjust enrichment is held in favor of the appellant as stated above and there is no dispute on this matter. Since these have been dealt with elaborately by the learned Member (Judicial) in her order the same is not being reiterated. There is no dispute that the amounts claimed as refund were not paid as duty under protest . The appellants after coming to realize their mistake have on their own filed a refund claim under section 11B of the CE Act before the department and have not approached a civil court for relief. Hence this is not a case where monies have been wrongly exacted by the department but it s a case where monies have been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n force between August 6, 1977 and November 17, 1980 contained sub-rule (4) which expressly declared: (4) Save as otherwise provided by or under this rule, no claim of refund of any duty shall be entertained . Section 11B, as in force prior to April, 1991 contained sub-section (4) in identical words. It said: (4) Save as otherwise provided by or under this Act, no claim for refund of any duty of excise shall be entertained . Sub-section (5) was more specific and emphatic. It said: Notwithstanding anything contained in any other law, the provisions of this section shall also apply to a claim for refund of any amount collected as duty of excise made on the ground that the goods in respect of which such amount was collected were not excisable or were entitled to exemption from duty and no court shall have any jurisdiction in respect of such claim. It started with a non-obstante clause; it took in every kind of refund and every claim for refund and it expressly barred the jurisdiction of courts in respect of such claim. Sub-section (3) of Section 11B, as it now stands, is to the same effect - indeed, more comprehensive and all-encompassing. It says, (3) Notwithstanding anything to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her incidental and ancillary provisions. As pointed out in the Statement of Objects and Reasons appended to the Bill which became the Act, the Act along with the Rules was intended to form a complete central excise code . The idea was to consolidate in a single enactment all the laws relating to central duties of excise . The Act is a self-contained enactment. It contains provisions for collecting the taxes which are due according to law but have not been collected and also for refunding the taxes which have been collected contrary to law, viz., Sections 11A and 11B and its allied provisions. Both provisions contain a uniform rule of limitation, viz., six months, with an exception in each case. Sections 11 and 11B are complimentary to each other. To such a situation, Proposition No. 3 enunciated in Kamala Mills becomes applicable, viz., where a statute creates a special right or a liability and also provides the procedure for the determination of the right or liability by the Tribunals constituted in that behalf and provides further that all questions about the said right and liability shall be determined by the Tribunals so constituted, the resort to civil court is not available - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Contract Act. So far as the jurisdiction of the High Court under Article 226 - or for that matter, the jurisdiction of this court under Article 32 - is concerned, it is obvious that the provisions of the Act cannot bar and curtail these remedies. Itis, however, equally obvious that while exercising the power under Article 226/Article 32, the Court would certainly take note of the legislative intent manifested in the provisions of the Act and would exercise their jurisdiction consistent with the provisions of the enactment. 69. There is, however, one exception to the above proposition, i.e., where a provision of the Act whereunder the duty has been levied is found to be unconstitutional for violation of any of the constitutional limitations. This is a situation not contemplated by the Act. ... .. ; ******* PART - IV 99. The discussion in the judgment yields the following propositions. We may forewarn that these propositions are set out merely for the sake of convenient reference and are not supposed to be exhaustive. In case of any doubt or ambiguity in these propositions, reference must be had to the discussion and propositions in the body of the judgment. (i) Where a refund ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd Salt Act or the Customs Act, as the case may be. It is necessary to emphasise in this behalf that Act provides a complete mechanism for correcting any errors whether of fact or law and that not only an appeal is provided to a Tribunal - which is not a departmental organ - but to this Court, which is a civil court. i) Where, however, a refund is claimed on the ground that the provision of the Act under which it was levied is or has been held to be unconstitutional, such a claim, being a claim outside the purview of the enactment, can be made either by way of a suit or by way of a writ petition. . . . . (emphasis added) 40.2 Hence as per the majority decision of five Hon ble Judges, the language of the statute could not have been more specific and emphatic. The exclusivity of the provision relating to refund is not only express and unambiguous but is in addition to the general bar arising from the fact that the Act creates new rights and liabilities and also provides forums and procedures for ascertaining and adjudicating those rights and liabilities and all other incidental and ancillary matters. This is a bar upon a bar any and every claim for refund of excise duty can be made o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ining and disposing of claims for a refund of monies paid under a mistake of law , by any one of the three decisions rendered separately by the majority. 40.4 Based on the discussion above the answer to the question raised at para 3(a) above, as to whether the impugned refund claim filed, based on payments made towards duty under a mistake of law, will lie under section 11B of the CE Act or under some other statute, is answered in favor of the Central Excise Act, 1944. Central Excise officers empowered under the Central Excise Act have/had the authority to admit, examine and decide the impugned claim arising from a mistake of law , exercising powers under section 11B of the Central Excise Act, 1944. They cannot take resort to an independent remedy from another statute when such a course is expressly barred by the provisions in the Act. Moreover, in this case the appellant paid monies as tax on his own without protest . It is only after the second clarification issued by the Board that the appellant felt that they had paid duty under a mistake of law and sought a refund, which was dismissed at the two lower levels of the departmental dispute resolution mechanism. Its only now that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... give relief. The relevant portion of the judgment is extracted below. 19. In Bengal Immunity Co. Ltd. v. State of Bihar Ors., AIR 1955 SC 661 it was observed by a Constitution Bench of this Court that, if there is any hardship, it is for the legislature to amend the law, and that the Court cannot be called upon, to discard the cardinal rule of interpretation for the purpose of mitigating such hardship. If the language of an Act is sufficiently clear, the Court has to give effect to it, however, inequitable or unjust the result may be. The words, dura lex sed lex which mean 'the law is hard but it is the law.' may be used to sum up the situation. Therefore, even if a statutory provision causes hardship to some people, it is not for the Court to amend the law. A legal enactment must be interpreted in its plain and literal sense, as that is the first principle of interpretation. 20. In Mysore State Electricity Board v. Bangalore Woolen, Cotton Silk Mills Ltd. Ors., AIR 1963 SC 1128 a Constitution Bench of this Court held that, 'inconvenience is not' a decisive factor to be considered while interpreting a statute. 21. In Martin Burn Ltd. v. The Corporation of Calcutta, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te of Madras (1966 2 SCR 229) after discussing the judgment of the Calcutta High Court in the cases of (i) Raleigh Investment Co. Ltd. v. The Governor General in Council (1944 1 Cal. 34), (ii) United Motors (India) Ltd. v. The State of Bombay (1952 55 BLR 246) and (iii) M.S.M.M. Meyappa Chettiar v. Income-tax Officer, Karaikudi (1964 54 ITR 151) held : There is, therefore, weighty authority for the proposition that a tribunal, which is a creature of a statute, cannot question the vires of the provisions under which it functions. A seven Judge Bench of the Hon ble Supreme Court in L. Chandra Kumar Versus Union Of India [1997 (92) E.L.T. 318 (S.C.)] held as under; 91. Before moving on to other aspects, we may summarise our conclusions on the jurisdictional powers of these Tribunals. The Tribunals are competent to hear matters where the vires of statutory provisions are questioned. However, in discharging this duty, they cannot act as substitutes for the High Courts and the Supreme Court which have, under our constitutional set-up, been specifically entrusted with such an obligation. Their function in this respects only supplementary and all such decisions of the Tribunals will be sub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... paid/ exacted due to a mistake of law made either by the tax payer/ assessee or the department. If this broader categorisation is done and if it is held that such claims are not to be examined under section 11B of the CE Act, and similarly its converse that demand under section 11A of the CE Act for taxes short collected/ not collected/ paid etc. due to a mistake of law are also not subject to the limitation of the CE Act, then it would lead to complexities in tax administration and difficulties, both for the department and for the assessee. It is perhaps for this reason that the majority judgment in the Mafatlal Industries case (supra) was quite categoric in declaring and clarifying that all refund claims other than those monies that have been found to have been collected unconstitutionally, must be filed and adjudicated under the provisions of the Central Excises and Salt Act or the Customs Act, as the case may be. 41.3 In the light of the above and the provisions of section 11B(3) of the CE Act, I do not find any specific provision in the said statute which explicitly permits me to judicially decide and condone the delay in the filing of the impugned refund claim, allowing the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tax, cannot be sustained. Further, a tax, be it, direct or indirect, is intended for immediate expenditure for the common good of the state and it would be unjust to require its repayment after it has been in whole or in part expended, which would often be the case in most payments of such sort. Therefore, it is impracticable for the authorities to refund applications that are filed beyond time even it is paid under a mistake of law. Therefore, the authorities have rightly rejected the claim of the respondent and this aspect has not been taken note of by the learned single Judge. (emphasis added) The judgement of the Hon'ble High Court of Madras in 3E Infotech Vs. CESTAT , (supra) hence proceeds sub silentio. The Hon'ble Supreme Court in State Of U.P. Ors vs Jeet S. Bisht Anr (2007 6 SCC 586) held as under; 18. No doubt in the aforesaid decision various direction have been given by this Court but in our opinion that was done without any discussion as to whether such directions can validly be given by the Court at all. The decision therefore passed sub silentio. The meaning of a judgment sub silentio has been explained by this Court in Municipal Corporation of Delhi Vs. Gurn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2 Joshi Technologies International contains reference to judgments that have considered the Hon'ble Supreme Court s judgment in Mafatlal industries Ltd. (supra). The Hon'ble Gujarat High Court in the said case while summarizing their decision held as under; 9. ... TO SUMMARISE:- ...... Since the provisions of Section 118 of the Act are not applicable to the claim of refund made by the petitioner, the limitation prescribed under the said provision would also not be applicable and the general provisions under the Limitation Act, 1963 would be applicable. Section 17 of the Limitation Act inter alia provides that when a suit or application is for relief from the consequences of a mistake, the period of limitation would not begin to run until the plaintiff or applicant has discovered the mistake, or could, with reasonable diligence, have discovered it Since the period of limitation begins to run only from the time when the applicant comes to know of the mistake, the application made by the petitioner was well within the prescribed period of limitation. Moreover, since the very retention of the Education Cess and Secondary and Higher Secondary Education Cess by the respondents is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der the CE Act without taking into consideration the limitations placed by the statute on him, was not a specific matter for consideration. The decisions of the Hon ble High Courts are in personam, passed considering the facts of the case and issues of law as placed before them and discussed. They are hence distinguished. 4.1.3 As regards the Hon'ble Andhra Pradesh, High court s judgment in Asia Pacific Commodities Ltd (supra), it relates to the Tribunal considering a new ground of the dispute canvassed by the parties before them. Since this is not a matter of dispute in this case the judgment is not relevant. Judgments passed by the Hon'ble High Tribunals 42.2 I next consider the judgments of the Hon ble Tribunals cited by the appellant; a) A.P. Enterprises Vs. Commissioner of Service Tax, Chennai reported in 2019 (6) TMI 18 CESTAT Chennai b) Venkatraman Guhaprasad Ors. Vs. Commissioner of GST Central Excise, Chennai South reported in 2019 (9) TMI 1143 - CESTAT Chennai c) M/s. Avadh Rail Infra Limited Vs. Commissioner of GST Central Excise, Lucknow reported in 2018 (7) TMI 1114 - CESTAT Allahabad d) Oriental Insurance Company Ltd. Vs. Commissioner of Central Excise and Ser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... udgment in Mafatlal Industries. They held as under; 9. The Apex court in Mafatlal Industries Ltd. (supra) observed that the Central Excise Act and the Rules made thereunder including Section 11B too constitute law within the meaning of Article 265 and that in the face of the said provisions which are exclusive in their nature no claim for refund is maintainable except and in accordance therewith. The Apex court emphasized that the provisions of the Central Excise Act also constitute law within the meaning of Article 265 and any collection or retention of tax in accordance or pursuant to the said provisions is collection or retention under the authority of law within the meaning of the said Article . 10. Having examined various decided cases and the submissions of both the sides, we are of the considered view that a claim for refund of service tax is governed by the provision of Section 11B for period of limitation. The statutory time limit cannot be extended by any authority as held by the Apex court. (emphasis added) The third Member held to the contra placing reliance on the decision of the Bombay High Court in Parijat Construction. The Hon ble Tribunal in Oriental Insurance Comp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... E.L.T. 247 (S.C.)] has by a majority verdict declared and clarified all the issues on the right to refund and the remedy for obtaining a refund of monies paid under a mistake of law , among other things, which is binding. b) Accordingly Statutory Authorities including Central Excise officers have the authority to admit, examine and decide the impugned claim arising from a mistake of law exercising powers under section 11B of the Central Excise Act, 1944. They cannot take resort to an independent remedy from another statute when such a course is expressly barred by the provisions in the Act. To hold otherwise, I feel, would be contrary to judgment by the Hon'ble Apex Court in Mafatlal Industries Ltd above. c) A legal enactment must be interpreted in its plain and literal sense. Authorities that are a creation of the statute are bound to act within the four corners of a statute and cannot ignore its provision to relieve what it considers a distress resulting from the operation of law. Hence, I am of the opinion that the impugned refund claim will have to be examined under the provisions of Section 118 of the CE Act. While the claim is found eligible on merits and is not hit by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... advancing the difference of opinion itself is incorrect and hence, cannot stand the scrutiny of law. In support, he placed reliance on the decision of the Hon'ble Gujarat High Court in the case of Court in the case of Colourtex vs. UOI - 2006 (198) ELT 169 (Guj.). It is submitted that in the context of reference made to the Third Member, the Hon'ble High Court held that in absence of statement of points or points of differences, any reference made would be invalid and it cannot be termed to be a mere procedural irregularity, hence, not sustainable. The said judgement has been followed by the same High Court in the case of Amod Stampings Pvt Ltd vs. CC - 2013 (7) TMI 55 Guj HC. Reiterating the principle laid down in Colourtex s case, the Hon'ble High Court quashed the order of Third Member as well as the difference of opinion formulated by the Members of the Division Bench holding that the point of difference was not formulated in the manner required under law. 45.3 The Ld. Advocate argued that the Interim Order which states that the appeal has to be dismissed or allowed, is not correct and not the objective of the provision of law prescribing reference for opinion of T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hority or jurisdiction conferred by law on the Third Member to decide the present difference of opinion between the Members of the Division Bench. The relevant provision governing the circumstances and procedures in resolving the difference of opinion between the Members of a Bench is prescribed under Section 129C(5) of the Customs Act, 1962, which reads as below: Section 129C. Procedure of Appellate Tribunal. (1) ---------------- (2) ---------------- (3) ---------------- (4) ---------------- (5) If the members of a Bench differ in opinion on any point, the point shall be decided according to the opinion of the majority, if there is a majority; but if the members are equally divided, they shall state the point or points on which they differ and make a reference to the President who shall either hear the point or points himself or refer the case for hearing on such point or points by one or more of the other members of the Appellate Tribunal and such point or points shall be decided according to the opinion of the majority of these members of the Appellate Tribunal who have heard the case, including those who first heard it. 48. The Hon ble Gujarat High Court in the case of Colortex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not permit disposal of the appeal. In fact, after the President or the Third Member, who is assigned the case for hearing on the point or points of difference, renders his opinion, the appeal goes back to the Bench which originally heard the appeal and has to be decided in accordance with the majority opinion. This becomes absolutely clear when the concluding portion of the provision is read which talks of deciding according to the opinion of the majority of the members who have heard the case, including those who first heard it. 19. Therefore, the members who expressed dissenting opinions are bound by the statute to state the point or points of difference and make reference after making such a statement. To use the words of the learned President an omnibus order cannot take place of the statement on point or points of difference between the members. The entire appeal(s) cannot be referred. 20. There is one more reason as to why the legislature in its wisdom has provided for this requirement, viz., stating the point or points of difference as a pre-condition for making the reference. In a given case, and it is not unknown that, though the members may express dissenting views they ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t only the point of difference as to whether the appeals merited rejection in the light of the view recorded by Member (Technical) or the appeals merited acceptance in the order recorded by Vice-President . All that can be said about this observation is that it belies comprehension. In one breath the learned Members seek opinion of Third Member as to allowability or rejection of the appeals and also that the appeals have not been referred. Possibly the learned Members have not appreciated the true import of provision of Section 129C(5) of the Act. The aforesaid principle has been followed by the same High Court in Amod Stampings Pvt Ltd s case. 49, Applying the principle laid down in the aforesaid judgments of the Hon'ble High Court to the reference in hand, it is clear that the appeal whether to be allowed or disallowed, has been referred instead of the exact point of difference leaving the ultimate results of the appeal to be arrived at subsequent to the opinion of the Third Member. The jurisdiction vested with the Third Member is to decide the point or points of difference; it cannot be extended further to reframe the issues and/or questions referred and express his opinion ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arat in Joshi Technologies International Vs UOI [2016 (339) ELT 577 (Guj.)] covers the issues raised in the appeal. (Pronounced in open court on 12-01-2024) (Sd/-) (Sd/-) (M. AJIT KUMAR) (SULEKHA BEEVI C.S.) Member (Technical) Member (Judicial) PER: DR. D.M. MISRA: ORDER DATED 31-05-2024 52. Heard both sides and perused the records. 53. The Points of Difference referred for opinion are: (i) Whether a claim for refund of Central Excise Duty paid under a mistake of law by the appellant will have to be filed under section 11B of the Central Excise Act, 1944 and are subject to the provisions including the time limit stated there under as per the law declared by the Hon ble Supreme Court in its judgment of Mafatlal Industries Ltd. Vs. UOL reported in [1997 (89) ELT 247 (SC)] and the Larger Bench decision of this Tribunal in Veer Overseas Ltd. Vs. CCE, Panchkula reported in [2018 (4) TMI 910 - CESTAT Chandigarh], whereby the refund claim filed by the appellant is time barred. OR (ii) Whether the judgment of the Hon'ble High Court of Madras in 3E Infotech Vs CESTAT, Chennai [2018 (18) GSTL 410 (Mad.)] is applicable. (iii) Whether the decision of the Hon'ble High Court of Gujarat i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of this Tribunal in the case of Veer Overseas Ltd. Vs. CCE, Panchkula [2018(15) GSTL 59 (Tri. LB)] and opined that the refund claim filed by the appellant after coming to know about the mistake of law would lie under Section 11B of the Central Excise Act, 1944; hence the time limit prescribed thereunder is applicable and the authorities below rightly rejected the refund claim holding that the same is barred by limitation prescribed under Section 118 of the Central Excise Act, 1944, 58. The learned advocate for the appellant advancing argument in support of the opinion expressed by the learned Member(Judicial) has submitted that the question which has been framed and referred to the Third Member is unwarranted as the issue of applicability of limitation under Section 11B of CEA, 1944 in such circumstance when duty is paid under a mistake of law has been consistently decided by co-ordinate Benches of this Tribunal in favour assessee. While passing the orders, the respective Division Benches had followed the judgment of the Hon'ble High Courts which have examined the decision in Mafatlal Industries case viz. Hon ble Karnataka High Court in KVR Constructions Vs. CCE, Bangalore [ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s decision in Joshi Technologies International, which followed the decision of the Delhi High Court in the case of Hind Agro industries Limited Vs. CC p2008(221) ELT 336 (Del.); Bombay High Court in the case of Parijat Construction Vs. CCE, Nashik [2018(359) ELT 113 (Bom.)] submitted that the limitation prescribed under Section 11B of the CEA, 1944 cannot be made applicable to the present case as the EC and SHEC has been paid by the appellant under mistake of law and collected by the Revenue without any authority of law and cannot be retained and limitation prescribed under Section 11B of CEA, 1944 not applicable to the present case. 59. The Revenue during the course of hearing and in their written submission dated 24.04.2024, responding to the submissions advanced by the appellant has submitted that the refund claim under Central Excise Act, 1944 is governed by Section 11B of the Act, which provides the terms and conditions for the Revenue authorities to adhere to sub- Section (3) of the Section 11B. It says that Notwithstanding anything to the contrary contained in any judgment, decree, order or direction of the Appellate Tribunal or any court or in any other provision of this A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1B of the Central Excise Act, 1944 is not applicable even in cases of payment of service tax paid due to mistake of law. 60. In support of their argument, the Revenue referred to following judgments:- i Universal Industrial Services Vs. CST, Bangalore [2017(8) TMI 471 -CESTAT BANGALORE] ii. Indo Global Estates Vs. CCE ST, Chandigarh [2020(3) TMI 1336 - CESTAT CHANDIGARH] iii. Radico NV Distilleries Maharashtra Ltd. Vs. CCE,C ST, Aurangabad [2018(4) TMI 1328 - CESTAT MUMBAI] iv. Pam Builders Developers Vs. CCE, Mangalore [2016(6) TMI 1106 - CESTAT BANGALORE] v. CCE, Hyderabad-III Vs. XL Telecom Ltd. [2006(3) TMI 641CESTAT, BANGALORE] vi. Avadh Rubber Vs. CCE, Dehradun [2017(11) TMI 37 - CESTAT, NEW DELHI] vii. Triveni Engineering Industries Limited Vs. CCG ST, Noida [2019(3) TMI 306 -CESTAT ALLAHABAD] 61. Further they have submitted that the learned Member(Technical) is not bound to follow the decisions of the preceding cases when the Tribunal itself is in fact bound to act within the ambit of the statutory provisions under which it is created; hence time limit under Section 11B of the CEA is applicable even in cases refund arising due to mistake of law in consonance to the judgment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ees sixty per tonne. (2) Every duty of excise leviable under sub-section (1) on any item shall be payable by the person by whom such item is produced, and in the case of crude oil, the duty of excise shall be collected on the quantity received in a refinery. (3) The duties of excise under sub-section (1) on the items specified in the Schedule shall be in addition to any cess or duty leviable on those items under any other law for the time being in force. (4) The provisions of the Central Excises and Salt Act, 1944 (1 of 1944) and the rules made thereunder, including those relating to refunds and exemptions from duties shall, as far as may be, apply in relation to the levy and collection of duties of excise leviable under this section and for this purpose the provisions of that Act shall have effect as if that Act provided for the levy of duties of excise on all items specified in the Schedule 64. Thus, the Cess of Rs.60/- p.m.t on the Crude Oil has been collected as duty of excise during the said period as prescribed under Section 15 of the said Act. The relevant provisions EC and SHEC which have been levied and collected on the said Excise duty( Oil cess) reproduced as below: 93. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ties of excise chargeable on such goods, under the Central Excise Act, 1944 or any other law for the time being in force and the Education Cess chargeable under section 93 of the Finance (No. 2) Act, 2004. (3) The provisions of the Central Excise Act, 1944 and the rules made thereunder, including those relating to refunds and exemptions from duties and imposition of penalty shall, as far as may be, apply in relation to the levy and collection of the Secondary and Higher Education Cess on excisable goods as they apply in relation to the levy and collection of the duties of excise on such good Two Circulars issued by the Board in 2004 and 2014 clarifying levy of Education Cess and SHEC on the Excise duty(Oil cess), relevant to the issue, are reproduced as below: (i) Circular Letter F.No.345/2/2004-TRU(Pt.) dated 10.08.2004 Subject: Issues relating to imposition of Education Cess on excisable goods and on imported goods, as pointed out by the trade and the field formations - Regarding. The undersigned is directed to state that subsequent to Budget, 2004 announcements, a number of representations / references have been received from the trade as well as from the field formations pertai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Secondary and Higher Education Cess are not to be calculated on cesses which are levied under Acts administered by Department/Ministries other than Ministry of Finance (Department of Revenue) but are only collected by the Department of Revenue in terms of those Acts. 5. All pending assessment may be finalized accordingly. 6. Difficulties, if any, may be brought to the notice of Board. 64. Aanalysis of the relevant provisions of the OIDC Act, 1974, it is clear that the cess has been collected as duties of excise and the provisions of Central Excises and Salt Act, 1944 and the rules made thereunder; particularly the provisions relating to refunds and exemptions from duties have been made applicable. Also, the EC and SHEC levied under the relevant provisions specifically refers to provisions of the Central Excise Act, 1944 relating to refunds, exemptions and imposition of penalty etc. for its administration. 65. The appellant had discharged EC and SHEC on Oil cess, considering it as duties of excise. Subsequently, applying the circular dated 07.01.2014 issued by the Board, wherein it is clarified that EC and SHEC be payable only on the cess which is administered and collected by Min ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons of the said Acts and would exercise their Jurisdiction consistent with the provisions of the Act. The writ petition will be considered and disposed of in the light of and in accordance with the provisions of Section 11B, This is for the reason that the power under Article 226 has to be exercised to effectuate the rule of law and not for abrogating it. The said enactments including Section 11B of Central Excises and Salt Act and Section 27 of the Customs Act do constitute law within the meaning of Article 265 of the Constitution of India and hence, any tax collected, retained or not refunded in accordance with the said provisions must be held to be collected, retained or not refunded, as the case may be, under the authority of law. Both the enactments are self-contained enactments providing for levy, assessment, recovery and refund of duties, imposed thereunder. Section 11B of the Central Excises and Salt Act and Section 27 of the Customs Act, both before and after the 1991 (Amendment) Act are constitutionally valid and have to be followed and given effect to. Section 72 of the Contract Act has no application to such a claim of refund and cannot form a basis for maintaining a su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en of duty to another person/other persons. His refund claim shall be allowed/decreed only when he establishes that he has not passed on the burden of the duty or to the extent he has not so passed on, as the case may be. Whether the claim for restitution is treated as a constitutional imperative or as a statutory requirement, it is neither an absolute right nor an unconditional obligation but is subject to the above requirement, as explained in the body of the Judgment. Where the burden of the duty has been passed on, the claimant cannot say that he has suffered any real loss or prejudice. The real loss or prejudice is suffered in such a case by the person who has ultimately borne the burden and it is only that person who can legitimately claim its refund. But where such person does not come forward or where it is not possible to refund the amount to him for one or the other reason, it is Just and appropriate that that amount is retained by the State, i.e., by the people. There is no immorality or impropriety involved in such a proposition. The doctrine of unjust enrichment is a just and salutary doctrine. No person can seek to collect the duty from both ends. In other words, he c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the validity of a statute. When it speaks of law , it no doubt refers to a valid law but the validity of a law has to be determined with reference to other provisions in the Constitution. 17. We must, however, pause here and explain the various situations in which claims for refund may arise. They may arise in more than one situation. One is where a provision of the Act under which tax is levied is struck down as unconstitutional for transgressing the constitutional limitations. This class of cases, we may call, for the sake of convenience, as cases of unconstitutional levy . In this class of cases, the claim for refund arises outside the provisions of the Act, for this is not a situation contemplated by the Act. (emphasis supplied) 18. Second situation is where the tax is collected by the authorities under the Act by mis-construction or wrong Interpretation of the provisions of the Act, Rules and Notifications or by an erroneous determination of the relevant facts, i.e., an erroneous finding of fact. This class of cases may be called, for the sake of convenience, as illegal levy. In this class of cases, the claim for refund arises under the provisions of the Act. In other words, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ears - the Supreme Court holds, in the case of some other manufacturer that the levy of that kind is not exigible in law. (We must reiterate - we are not speaking of a case where a provision of the Act whereunder the duty is struck down as unconstitutional. We are speaking of a case involving interpretation of the provisions of the Act, Rules and Notification.) The question is whether * X can claim refund of the duty paid by him on the ground that he has discovered the mistake of law when the Supreme Court has declared the law in the case of another manufacturer and whether he can say that he will be entitled to file a suit or a writ petition for refund of the duty paid by him within three years of such discovery of mistake? Instances of this nature can be multiplied. It may not be a decision of the Supreme Court that lead X to discover his mistake; it may be a decision of the High Court. It may also be a case where X fights up to first appellate or second appellate stage, gives up the fight, pays the tax and then pleads that he has discovered the mistake of law when the High Court has declared the law. The fact is that such claims have been entertained both in writ petitions and s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pment) Act, 1974, which is administered by Ministry of Petroleum. Therefore, the principles l:id down in sub-para (i) of para 99 of the said judgment, in my opinion, is squarely applicable to the present case. 73. A simple reading of the said observation it is clear that a claim of refund when it is in the nature of illegal levy , necessarily to be pursued under and in accordance with the provisions of the respective enactment whereunder it is paid; the mechanism/procedure for its refund is prescribed under the said enactment, including the authorities specified thereunder and the period of limitation prescribed therein. This is clear from Their Lordships observation as: no suit is maintainable in that behalf , However, an exception to the said principle, also observed by their Lordships as: while the jurisdiction of the High Courts under Article 226 and of this Court under Article 32 cannot be circumscribed by the provisions of the said enactments, however, they will certainly have due regards to the legislative intent evidenced by the provisions of the said Acts and would exercise their Jurisdiction consistent with the provisions of the Act . Thus, all refunds relating to illegal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. UOI [2016(339) ELT 21 (Guj.)] which has been later followed by the jurisdictional High Court of Madras in the case of 3E Infotech Vs. CESTAT, CCE(Appeals-I) [2018(18) GSTL 410 (Mad.)]. No doubt in Joshi Technologies International, INC-India Projects case, the issue relates to refund of the EC and SHEC paid on the OIDC for the same period of dispute; however, the issue carried before the Hon'ble Gujarat High Court was by way of filing a Writ Petition under Article 226 against the rejection of the refund claim, as is clear from para 2 of the said judgment, which reads as follows:- 2. It is the case of the petitioner that without considering the submissions advanced on behalf of the petitioner during the course of personal hearing and in the written submissions, by the impugned order dated 24-11-2014, the second respondent rejected the entire refund claim of Rs. 73,60,061/- under the provisions of Section 11B of the Central Excise Act. Being aggrieved, the petitioner has filed the present petition challenging the order-in-original dated 24-11-2014 passed by the Respondent No. 2 and seeks a direction to the second respondent to forthwith sanction and grant the petitioner refund ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g on them. The Hon'ble Supreme Court in Mafatlal Industries Ltd. (supra) categorically held that no claim for refund of any duty shall be entertained except in accordance with the provisions of the statute. Every claim for refund of excise duty can be made only under and in accordance with Section 11B in the forms provided by the Act. The Apex Court further observed that the only exception is where the provision of the Act whereunder the duty has been levied is found to be unconstitutional for violation of any of the constitutional limitations. This is a situation not contemplated by the Act. We note in the present case there is no such situation of the provision of any tax levy, in so far as the present dispute is concerned, held to be unconstitutional. As already held that the appellant is liable to pay service tax on reverse charge basis but for the exemption which was not availed by them. We hold that the decision of the Tribunal in Monnet International Ltd. (supra) has no application to decide the dispute in the present referred case. We take note of the decision of the Tribunal in XL Telecom Ltd. (supra). It had examined the legal implication with reference to the limitat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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