Duty-paid storage of excisable goods does not create refund rights merely because later sale prices fall.

Excisable molasses permitted for storage in kutcha pits were treated as duty-paid goods because duty had to be paid first at the rate applicable on the date of removal. A later refund claim failed where the assessee had not sought provisional assessment, had not challenged the condition requiring prepayment, and could not recast a final duty payment as a provisional deposit through later correspondence. The fact that the goods were subsequently sold at a lower price did not create a refundable entitlement, and rules governing storage without payment of duty were inapplicable because the goods were not stored under bond.

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Issues: Whether the assessee was entitled to refund of duty paid on molasses stored in kutcha pits after payment of duty at the rate applicable on the date of removal.

Analysis: Permission to store the molasses in kutcha pits was granted on the clear condition that duty had first to be paid and that the assessable value and duty were to be determined according to the rate then applicable. The goods were therefore treated as duty paid goods when shifted to the kutcha pits. The later request for refund rested on the contention that the subsequent sale value was lower and that the duty should be treated as paid under protest. That contention was rejected because the assessee had not followed the procedure for provisional assessment, had not challenged the permission requiring prepayment of duty, and could not convert a final payment made under an operative departmental direction into a refundable provisional deposit merely by later correspondence. The cited rules regarding storage without payment of duty did not assist the assessee because the present case concerned duty paid goods, not non-duty paid goods stored under bond.

Conclusion: The refund claim was not maintainable and was rightly rejected.

Ratio Decidendi: Where excisable goods are permitted to be stored only after payment of duty at the rate applicable at the relevant time, and the assessee neither secures provisional assessment nor challenges the order requiring such payment, no refund can be claimed merely because the goods are later sold at a lower price or are subsequently said to have been paid under protest.

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