Custom, Excise & Service Tax Tribunal
Commissioner, C.Ex. & S.Tax vs M/S Rita Dyeing & Printing Mills Pvt. Ltd on 10 August, 2016
In The Customs, Excise & Service Tax Appellate Tribunal West Zonal Bench At Ahmedabad Appeal No.E/590/2008-DB [Arising out of OIA No.RKA/381/SRT-I/08, dt.11.04.2008, passed by Commissioner (Appeals), C.Ex. & S.Tax, Surat-I] Commissioner, C.Ex. & S.Tax, Surat-I Appellant Vs M/s Rita Dyeing & Printing Mills Pvt. Ltd. Respondent
Represented by:
For Appellant: Shri L. Patra, A.R. For Respondent: Shri Rahul Gajera, Advocate For approval and signature:
Honble Dr. D.M. Misra, Member (Judicial)
1. Whether Press Reporters may be allowed to see the No Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3. Whether their Lordships wish to see the fair copy of Seen the order?
4. Whether order is to be circulated to the Departmental Yes authorities?
CORAM:
HONBLE DR. D.M. MISRA, MEMBER (JUDICIAL) Date of Hearing/Decision:10.08.2016 Order No. A/10705/2016, dt.10.08.2016 Per: Dr. D.M. Misra:
Heard both sides and perused the records.
2. This is an appeal filed against the OIA No.RKA/381/SRT-I/08, dt.11.04.2008, passed by Commissioner (Appeals), C.Ex. & S.Tax, Surat-I.
3. Briefly stated the facts of the case are that the Appellant are engaged in the manufacture of processed man made fabrics with the aid of Hot Air Stenter and discharging duty under Compounded Levy Scheme notified under Section 3A of Central Excise Act, 1944. The annual capacity of production was determined under Hot Air Stenter Independent Textile Processors Annual Capacity Determination Rules, 1998 on the basis of declaration filed under Rule 96ZQ of erstwhile Central Excise Rules, 1944. The Appellant had paid the duty under protest on the ground that in the determination of annual production capacity, the length of gallery was wrongly included. Subsequently, after protracted litigation, the issue has been decided by the Larger Bench of the Tribunal in Sangam Processors, Bhilwara Vs CCE 2001 (127) ELT 679 (Tri-LB), where under it has been held that inclusion of gallery in the length of chambers is incorrect, which was approved by the Hon'ble Supreme Court in CCE, Jaipur-II Vs S.P.B.L. Ltd 2002 (146) ELT 254 (SC). Consequently, the Appellant filed the refund claim as the duty was paid under protest. The refund claim was rejected on the ground that the assessment order/determination of annual capacity of production was not challenged before the appropriate forum. Aggrieved by the same, the Respondent filed an appeal before the Commissioner (Appeals), who in turn, allowed their appeal. Hence, Revenue is in appeal.
4. The learned Authorized Representative for the Revenue reiterates the grounds of appeal.
5. The learned Advocate for the Respondent submitted that the issue is squarely covered by the judgment of the jurisdictional Hon'ble Gujarat High Court in the case of Premraj Dyeing & Printing Mills Pvt. Ltd Vs UoI 2013 (288) ELT 357 (Guj.)
6. I find that the issue is no more res integra being covered by the judgment of Hon'ble Gujarat High Court in Premraj Dyeing & Printing Mills Pvt. Ltds case, wherein their Lordships have observed as:-
17.?If the determination was not appealable, in our view, it would be incorrect to hold that without challenging such an order, the manufacturer cannot claim refund of duty erroneously collected. The fact that the galleries were included while determining the Annual Production Capacity and as such, the galleries were otherwise not required to be included by virtue of the decisions of the Tribunal and the Apex Court, there is no dispute. In our view, therefore, the petitioners were justified in filing refund claims in terms of Section 11B of the Central Excise Act claiming refund of excess duty collected on the basis of such consideration of galleries in determining Annual Production Capacity and collecting corresponding excise duty on such capacity. In our view, the excise authorities as well as the Tribunal erred in rejecting such claims merely on the ground that the determination of Annual Production Capacity was not challenged. The decisions of the Apex Court in case of Mafatlal Industries (supra) as well as Collector v. Flock (India) Pvt. Ltd. (supra) would not apply. In case of Mafatlal Industries, the Apex Court ruled that an assessee cannot claim refund that too after the indefinite period of time on the strength of decision in case of another assessee. In Collector v. Flock (India) Pvt. Ltd. (supra), it was a case where classification of a product was the controversy. The Assistant Collector passed an order of such classification. Such order though appealable, was not challenged by the assessee. The assessee, however, filed a refund claim. The Apex Court observed that there is little scope for doubt that in a case where an adjudicating authority has passed an order which is appealable under the statute and the party aggrieved did not choose to exercise the statutory right of filing an appeal, it is not open to the party to question the correctness of the order of the adjudicating authority subsequently by filing a claim for refund on the ground that the adjudicating authority had committed an error in passing the order. It was, thus, clearly a case where an order which was appealable was not challenged by the party. The legality thereof, however, was questioned in refund proceedings. It was in this background that the Apex Court held that the refund claim was not maintainable. In the present case, the facts are vitally different. We have already held that the determination of Annual Production Capacity by the prescribed authority under the Rules of 2000 did not give rise to an appealable order.
7. The aforesaid judgment of the Hon'ble Gujarat High Court is clearly applicable to the facts and circumstances of the present case. Accordingly, for allowing refund of duty paid under protest by the Appellant consequent to the Order pertaining to determination of annual capacity of production by inclusion of length of gallery, the said Order need not be separately appealed.
8. In the result, the Revenues appeal being devoid of merit is accordingly dismissed.
(Dictated and pronounced in the open court) (Dr. D.M. Misra) Member (Judicial) Cbb 4