Provisional contract price and excise refund: excess duty paid after final price reduction was held refundable within limitation.

Where the supply contract expressly made the price provisional and liable to revision on finalisation of tendered rates, the price at removal could not be treated as finally fixed for excise purposes. Failure to use provisional assessment under Rule 9B did not change the contractual position that the contract price was not final. As the refund claim was filed within the limitation period under Section 11B, excess duty paid after the price reduction was refundable. The refund of duty paid in excess was therefore admissible.

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Issues: Whether refund of central excise duty was admissible where the contract price for the goods was expressly provisional and was later reduced, even though the assessee had not resorted to provisional assessment.

Analysis: The contract governing supply of the goods expressly stated that the rates were provisional and were subject to change on finalisation of the tendered rates. In such a situation, the prices prevailing at the time of removal could not be treated as final prices for all purposes. The absence of provisional assessment under Rule 9B did not alter the contractual position that the price itself was not finally fixed. As the refund claim was filed within the statutory period prescribed under Section 11B, the excess duty paid on account of the reduction in price after finalisation became refundable.

Conclusion: Refund of the duty paid in excess was admissible, and the appeal succeeded.

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