Customs, Excise and Gold Tribunal - Tamil Nadu
Commissioner Of C. Ex. vs Rane Engine Valves Ltd. on 2 May, 2003
Equivalent citations: 2003(162)ELT417(TRI-CHENNAI)
ORDER Jeet Ram Kait, Member (T)
1. This appeal by the Revenue is directed against the Order-in-Appeal No. 143/99 (M-III), dated 5-7-99, by which the ld. Commissioner (Appeals) has set aside the order-in-original dated 30-7-98 passed by the Asstt. Commissioner of Central Excise, Chinglaput Division, regarding refund of the amount paid by the respondent before the adjudication proceedings were completed. The ld. Commissioner considered this amount only as a deposit because there was no order demanding duty and only Show Cause Notice had been issued, which was pending adjudication. It was in this background that the ld. Commissioner (Appeals), has set aside the order of the Asstt. Commissioner who had rejected their refund claim as time barred.
2. Aggrieved by the order of the ld. Commissioner, Revenue has come in appeal on the ground that once the assessees paid certain amounts as "duty" by making proper entries in PLA or RG 23A Part II, it should be treated as "duty" and cannot be treated as "deposit" with the Government as observed by the Commissioner (Appeals). They have tried to take support from Rule 173G and pleading that the deposits are only the periodical cash credits made by the assessees in the PLA sufficient to cover the duty due on the goods intended to be removed at any time. The Revenue, therefore, contended that any other payment cannot be construed as deposits but should be known only as duty. They, therefore, submitted that the refund should have been claimed within six months from the date of payment of duty in terms of Section 11B of the CER. Whereas, in the instant case the assessees paid duty after the issue of show cause notice on 15-7-94 and filed the refund claim only on 15-7-97 which is way beyond the prescribed time limit. They have tried to distinguish the case law applied by the ld. Commissioner in the matter of CCE, Kanpur v. Mahajan Iron Foundry reported in 1996 (81) E.L.T. 614 (T). The Revenue also pleaded that the Asst. Commissioner, was right in observing in his order-in-original that the assessees had not followed the procedures set out under Rule 233B of CER, 1944, hence the payment made after 2 years of issue of SCN in order to get the licence cancelled cannot be considered as the duty paid "under protest". In this connection, the revenue relied on the Larger Bench of Apex Court in the case of Mafatlal Industries Ltd., v. UOI, reported in 1997 (89) E.L.T. 247 (S.C.) in Para 85 of the judgment, it has been held that any person paying the duty under protest has to follow the procedure prescribed by the Rule and once he does so, it shall be taken as he has paid the duty under protest and the period of limitation of 6 months will then have application to him. Therefore, the revenue submitted that this judgment is squarely applicable in the present case as the assessee has not followed the procedure prescribed under Rule 233B of CER, 1944 and hence the refund claim is liable for rejection.
3. Ld. DR, Shri A. Jayachandran reiterates the grounds of appeal and prays that the Order-in-Appeal No. 143/799 (M-III), dated 5-7-99, passed by the Commissioner (Appeals), Chennai, be set aside and the Order-in-Original No. 76/98, dated 30-7-98, passed by the Asstt. Commissioner, Chenglaput Division, rejecting the refund claim be restored.
4. None appeared for the respondents in spite of service of the notice on 28-3-2003. Therefore, I proceed to decide the case on merits on the basis of the records and submissions made by the ld. DR.
5. The brief facts of the case are that the respondents deposited an amount of Rs. 27,091/- in their PLA vide SI. No. 345, dated 15-7-94 in terms of Show Cause Notice No. 1235, dated 4-8-92. on the interest charges against delayed payment. This amount was paid in response to the show cause notice before the case was adjudicated. The case was decided in their favour vide adjudication Order No. 2/97, dated 28-1-97. In other words, the respondents had to file their refund claim within 6 months from the date of the order i.e. 2/97, dated 28-1-97, was passed in their favour. It is also stated that while depositing the above said amount, they had written a letter dated 15-7-94, had informed the department that they had intention to claim refund if they succeeded in the proceedings initiated against them. This letter also makes the position very clear that they had deposited the said amount only in response to the proceedings to the SCN and subsequently they had filed a refund claim for the above amount. However, the Order No. 2/97, dated 28-1-97, was passed in their favour and it was only after the receipt of this order from the Asstt. Commissioner, they came to know about the refund i.e. on or before 28-1-97 and filed the refund claim on 15-7-97, though, they have deposited the amount on 15-7-94. In view of the above facts and circumstances, the amount deposited immediately after the issue of SCN and before passing the adjudication order, has to be treated as 'deposit' and there is no time limit for such deposit to claim the refund. However, the Doctrine of unjust enrichment was not applicable in such deposits of amount pending finalisation of the adjudication proceedings. In this connection, I refer to the judgment of the Hon'ble High Court of Gujarat at Ahmedabad, in the case of Parle International Ld. v. UOI, reported in 2001 (127) E.L.T. 329 (Guj.), wherein it has been held that the amount deposited by petitioner during adjudication proceedings has to be regarded as 'deposit' and not duty and Doctrine of unjust enrichment is not applicable to such deposit nor is provision under Rule 233B of Central Excise Rules, 1944 applicable. It is also ordered by the Hon'ble High Court that the amount so deposited by the petitioner shall be refunded along with interest. By respectfully following the above judgment, I do not find any infirmity in the order passed by the ld. Commissioner and the same is sustained. I, therefore, reject the appeal filed by the Revenue. Ordered accordingly.