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wherein the Asstt. Collector after the duty had been paid under protest, has accepted that payment of duty was made under protest. In the operative portion of the order the Tribunal had observed as under:
Therefore, the question as to whether necessary endorsement to the effect that duty has been paid under protest, has been made, on gate passes and RT-12 in terms of Rule 233B does not arise as duty was demanded after removal of the goods filing of RT-12. The Assistant Collector has taken note of the provisions of Rule 233B and after considering the representation of the appellants in regard to the payment under protest by them, has issued an order. In view of this, it can be said that the requirements of Rule 233B of the Central Excise Rules, 1944 have been complied with so far as the appellants are concerned. The Hon'ble Supreme Court in the case has held that the burden was on the department to show how the assessee had failed to observe the prescribed procedure. In the present case, there is no doubt that the appellants have made payments under protest as soon as the demands were raised and they have also requested the authorities to intimate them the procedure to be followed under Rule 233B in this regard. From the above discussion, in our view, the appellants have complied with the necessary requirements under the Rules. In view of above, we hold that inasmuch as the Assistant Collector has taken the payments made by the appellants as "under protest" his order acquired finality and another authority namely another Assistant Collector before whom the refund claim was filed cannot hold otherwise on the same issue. In view of the above we hold that the appellants' case has to be considered on the ground that duty was paid under protest.

In the record of personal hearing, however, there is no mention about this payment under protest. An analysis of the facts as above shows that the genesis of the demand was the visit of the Asstt. Collector on 28.10.1986 when he discussed and pointed out that Vulcanising Solution was liable to pay duty at the rate of 40% and not 15% as per the classification list approved. The Asstt. Collector, however, did not take any action thereafter and the appellants on their own, vide their letter dated 30.10.1986, tried to explain that the goods were in fact chargeable to duty at the rate of 15% and referred to Notification 377/86. The matter rested there until a show cause notice dated 31.3.1987 was issued. Neither the appellants felt the necessity to pay the differential duty for the past period nor for their clearances after the visit of the Asstt. Collector at the higher rate of 40% nor the authority viz. the Asstt. Collector felt any urgency to issue a show cause notice asking them to file a fresh classification list or to raise a demand for the differential duty at the rate of 40% for the period from 1.3.1986 onwards. It is presumed, that RT 12 returns etc. filed were assessed as per the earlier approved classification list. In such a situation it cannot be said that the authorities in any way raised any demand and created a situation in law whereby the appellants were required to pay the differential duty. The show cause notice dated 31.3.1987 merely asked the appellants to show cause as to why the classification should not be approved under heading 4005.00 without the benefit of Notification 377/86 and in passing made a mention asking the appellants to show cause why duty on the past clearances should not be demanded at 40% ad valorem. The position as it stood in law at that time was that there was neither a direction nor any compulsion cast under any law to pay duty at higher rate when they had an approved price-list whereimder duty at the rate of 15% was payable. The appellants on their own for the reasons best known to them chose to pay the differential duty on 6.4.1987 for the period 1.3.1986 to 31.10.1986 and they endorsed the challan with the words "duty paid under protest" and also wrote a letter dated 10th April, 1987 stating that they had paid this duty under protest and gave the grounds of protest also. The question to be considered is: did any circumstance under the law exist which warranted payment by them whereby it could be said that the appellants had no choice but to pay contrary to what they felt was payable? We observe that the appellants after the visit of the Asstt. Collector and even after the issue of show cause notice for their day-today clearances after these dates did not pay duty at the higher rate and continued to clear the goods without any intervention by the authorities by paying the lower rate of duty. The authorities, therefore, were reconciled to waiting out for the outcome of the proceedings drawn vide letter dated 31.3.1987. If is not understandable as to why the appellants suo motu chose to pay the duty for the period 1.3.3986 to 31.3.1987 on 4.6.1987, when as it is, going by the facts of this case the demand prior to 30th September, 1986 was barred by limitation as there was no suppression of facts etc. involved nor attributed in the show cause notice. There was no hostile situation under the law for the purpose of payment of the duty for the period 1.3.1986 to 31.10.1986 which warranted a protest. The word 'protest' has to be given a legal meaning. It is not as if any payment made by an assessee even though correctly can be endorsed as payment under protest. Protest can only arise in a situation where in law a duty in law is cast on the appellants to pay up a certain amount against their understanding of their liability to pay. In the present case in view of the above we are of the opinion that the circumstance did not warrant any payment of duty under protest. An oral request or a regular discussion cannot in law be taken cognisance of as casting any legal obligation on the appellants to pay the duty more so when even the issue was still at large. If any payment in a situation like this is made suo motu the appellants will have to look for other avenues other than the route by way of a protest for retrieving this amount in case they feel that ultimately they would be eligible to get it back.

(2) A manufacturer who has filed a declaration under Sub-rule (1) may, after obtaining the acknowledgement aforesaid, take credit of the duty paid on the inputs received by him.

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It will be seen that so far as the eligibility to MOD VAT ciedit is concerned the provision regarding declaration is similar to the provision for letter for the purpose of payment of duty under protest under Rule 233B. A further reading of Rule 233B shows that in terms of Sub-rule (4) the duty paid under protest shall be made on all copies of the gate passes and also on the RT 12 returns filed for each month in regard to the clearances made. The appellants have pleaded that in the present case since the clearances had already been made, therewas no question of endorsing of the gate passes and RT 12 returns and this requirement in this case would not apply. We, however, have a different view of the matter and we observe that the provision of Sub-rule (4) gives an indication as to the circumstances under which the payment can be made under protest. It is observed that, as we have held, in terms of Sub-rules (1), (2) and (3) the eligibility for payment of duty under protest from the date on which the letter of protest was delivered to the proper officer and thereafter it is applicable only to such cases where clearances have to be made on gate passes. In other words the payment of duty under protest is to cover such contingencies where the authorities under the law have put the assessee in a position where he is required to pay duty at a rate higher than what he understands is his liability and the clearances have to be made on an on going basis. The facility is made available so that such an assessee is not called upon to file refund claims on an on-going basis and his protest would take care of the requirement to file these refund claims for every clearance on payment of duty and the limitation. Sub-rule (4) clearly brings out the fact that the provision for payment of duty under protest is only in contingencies where future ramifications are involved and day-to-day clearances have to be made and to obviate the heed to file repetitive refund claims till the issue is finally decided in the matter of assessment. The payment of duty for past clearances under protest in the light of this cannot be taken to be provided for in law. If an assessee pays duty suo motu without being under the compulsion of law to do so, as is the case of the appellants as brought out above, the appellants after payment could have only filed a refund claim for claiming the amount back, a legal provision which is available. The appellants had the option not to pay this amount until the proceedings for demand of the amount had culminated after the issue of the show cause notice in the order of the Asstt. Collector. In the present case the order of the Asstt. Collector only demanded duty from the appellants from 1.11.1986 onwards and not for the past periods. Sub-rules (5), (6) and (7) of Rule 233B provide for what the assessee is supposed to do after he starts paying duty under protest and when his right to pay the duty under protest comes to an end. These sub-rules point to the fact that the facility for payment of duty under protest on an on-going basis is provided for cases where on-going clearances were to be made and payment of duty have to be made, prospectively. Sub-rule (8) sets out that if any one of the provisions of this Rule have not been complied with, it shall be deemed the assessee has paid the duty without protest. A decision has been cited before us where it has been held that in case if there is any minor variation in the compliance of the rules the same can be ignored. The minor variation can be in the matter of going on record as to the payment of duty under protest in respect of each clearance and in respect of which case law has been cited. The provisions of Rule 233B, as pointed out earlier, are partly mandatory and partly directory and the deviation in respect of the compliance has to be read taking into consideration the deviation in a particular case. In the present case, as analysed above, there has been hardly any compliance with any of the provisions of this Rule.

Taking the first ground about duty having been paid under protest, the challans under which the amounts had been paid bear the endorsement of payment 'under protest'. Payment was made in pursuance of the order-in-original of the AC. It is an undisputed position that the said order was taken in appeal before the Collector (Appeals). Rule 233B of the Central Excise Rules provide for the procedure laid down for raising the protest and the essence behind the same is that the party paying should not raise a protest just for the sake of raising but should have some ground to agitate upon and that some proceedings in relation thereto are being initiated. It has been practically a settled position that the provisions of Rule 233B are procedural in nature and substantial compliance thereof is called for.