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TMI Blog2002 (11) TMI 126X X X X Extracts X X X X X X X X Extracts X X X X ..... rovisions of the Central Excises and Salt Act, 1944 (hereinafter referred to as the Act). It has been registered as a small-scale industry and was initially exempted from the payment of excise duty on its clearances. However, the petitioner paid excise duty under mistake and on discovery of the mistake, it filed an application for refund under Section 11B of the Act as it then stood. The refund application was rejected by the Assistant Collector, Central Excise. The appeal filed by the petitioner was also dismissed by the Collector (Appeals) Central Excise. Thereafter, the petitioner approached this Court by filing Civil Misc. Writ Petition No. 358 (Tax) of 1987 wherein it had challenged both the orders passed by the Assistant Collector as well as Collector (Appeals). This Court vide judgment and order dated 9-12-1987 allowed the writ petition. The operative portion of the said judgment is reproduced below : "In the result, this petition succeeds and is allowed. A direction is issued to the opposite parties to refund the duty collected during 1983-84 and 1984-85 on clearance for home consumption after deducting the amount already paid." 4. It may be mentioned here that this Cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vil misc. writ petition No. 358 (Tax) of 1987 and when the Government of India filed Special Leave Petition No. 7561 of 1988, before the Hon'ble Supreme Court which was barred by 115 days in the year 1988 itself, the result was that the judgment and order dated 9-12-1987 became final before coming into force of the Act No. 40 of 1991. Thus, the respondent Nos. 2 and 3 have wrongly rejected the claim of refund by applying the provisions of Section 11B of the Act. He relied upon the decision of Constitution Bench of Hon'ble Supreme Court in the case of Mafatlal Industries Limited and Others v. Union of India and others reported in 1997 (89) E.L.T. 247 (S.C.) = (1997) 5 SCC 536, where it has been held that where the refund proceedings have finally terminated in the sense that the appeal period has also expired before the commencement of 1991 (Amendment) that cannot be reopened and/or governed by Section 11B(3) (as amended by the 1991 Amendment Act), reserving the powers of the Appellate Authority to condone the delay in proper cases. Thus, he submitted that the petitioner is entitled for refund and two orders passed by the respondent, are liable to be set aside. He further submitted t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section (2) of Section 11B of the Act. Thus, the provisions of Section 11B(2) are to be complied with. He relied upon the decision of Hon'ble Supreme Court in the case of Union of India v. Raj Industries Limited [2000 (120) E.L.T. 50 (S.C.)]. He also relied upon the decision of Hon'ble Supreme Court in the case of Union of India v. Jain Spinner Limited - 1992 (61) E.L.T. 321 and Porcelain Electrical Manufacturing Co. Ltd. v. Collector of Central Excise, New Delhi - 1998 (98) E.L.T. 583. 9. In reply, Shri Dubey submitted that the alternative remedy is not on absolute bar where a pure question of law is involved. He relied upon the decision of Hon'ble Supreme Court in the case of Dr. Bal Krishna Agarwal v. State of Uttar Pradesh and Ors. - J.T. 1995 (1) SC 471 wherein, the Hon'ble Supreme Court has held that 'since the question that is raised involves a pure question of law and even if the matter is referred to the Chancellor under Section 58 of the Act, it is bound to be agitated in the Court by the party aggrieved by the order of the Chancellor, we are of the view that this was not a case where the High Court should have non suited the appellant on the ground of availability of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble, he may make an order accordingly and the amount so determined shall be credited to the Fund : Provided that the amount of duty of excise as determined by the Assistant Commissioner of Central Excise under the foregoing provisions of this sub-section shall, instead of being credited to the Fund, be paid to the applicant, if such amount is relatable to - (a) rebate of duty of excise on excisable goods exported out of India or on excisable materials used in the manufacture of goods which are exported out of India, (b) unspent advance deposits lying in balance in the applicant's account current maintained with the Commissioner of Central Excise, (c) refund of credit of duty paid on excisable goods used as inputs in accordance with the rules made, or any notification issued, under this Act; (d) the duty of excise paid by the manufacturer, if he had not passed on the incidence of such duty to any other person; (e) the duty of excise borne by the buyer, if he had not passed on the incidence of such duty to any other person; (f) the duty of excise borne by any other such class of applicants as the Central Government may, by notification in the official Gazette, specify : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt to the Fund, can be paid to the person concerned. These provisions are applicable notwithstanding anything to the contrary contained in any judgment, decree, order or direction of the Appellate Authority or any Court. This Court vide judgment and order dated 9-12-1987 had directed the opposite parties to refund the duty collected during the year 1983-84, 1984-85. The application for refund was made by the petitioner on 8-2-1988. However, the duty was not refunded. The matter remained pending. After the Special Leave Petition was dismissed by the Hon'ble Supreme Court on 8-5-1995, the petitioner made an application in the proper form on 24-2-1997 claiming refund. The said application was processed under Section 11B of the Act. The petitioner did not give any evidence to show that he had not passed on the incidence of duty to any other persons as required under Clause (d) of the proviso to sub-section (2) of Section 11B of the Act and, therefore, the claim has been rejected and the amount of refund has been credited to the Consumer Welfare Fund. The reliance placed by the learned Counsel for the petitioner to paragraph 108 (XI) of the decision of Hon'ble Supreme Court in the case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e duty amount, which had been erroneously refunded. The assessee questioned the order of the Assistant Collector through a writ petition before the High Court and also by filing an appeal before the Collector of Central Excise (Appeals). The High Court issued an interim stay in favour of the assessee against the demand confirmed by the Assistant Collector's order subject to the assessee depositing the amount of the demand in the Court. The respondent (Union of India) was permitted to withdraw the amount by an interim order of the Court on February 19, 1986 subject to the condition that it would pay interest at bank rate and refund the amount along with interest within two months of the decision of the writ petition if the petitioner ultimately succeeded. The appeal filed by the assessee before the appellate authority, however, succeeded and consequential relief was ordered, 'if otherwise admissible'. The assessee, thereupon, filed an application before the Assistant Collector for refund of the duty plus interest as per the conditions contained in the interim order of the High Court. The assessee also filed an application before the High Court stating that in view of the appellate o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as claimed could not be an exception to the provisions of Section 11B(3) of the Act, and that the High Court could not have made any order, after September 20, 1991 directing the payment of refund contrary to the amended provisions of Section 11B(2) of the Act. The Court expressed the view that Section 11B of the Act, as amended, would apply to all cases which were pending notwithstanding any order or decree or judgment of a Court or Tribunal or the provisions of any other law for the time being in force. The Apex Court inter alia held as follows : "The only question before us is whether the impugned order dated April 20, 1992 of the High Court which is passed to give effect to its earlier order of February 19, 1986, is valid or not. Since, we are of the view that the order of February 19, 1986 attracts the provisions of sub-section (3) of Section 11B of the Act which has come into force on September 20, 1991 the respondents are not entitled to take advantage of the said order unless they succeed in showing to the statutory authorities that they had not passed on the whole or any part of the duty in question to others." In the case of Union of India v. Raj Industries (supra), t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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