Protest payment on duty challans can sustain refund claims even without strict Rule 233B compliance for statutory cess.

Payment of statutory cess on a consolidated quarterly basis, with challans endorsed "paid under protest" and countersigned by departmental officers, was treated as a valid recorded protest for refund purposes. The Tribunal noted that Rule 233B of the Central Excise Rules, 1944 was not strictly applicable to cess paid under Section 3(1) of the Vegetable Oils Cess Act, 1983, because the cess followed a different payment mechanism and the rule was not expressly extended to it. On that basis, the refund claims were held not time-barred and not defeated by unjust enrichment, and the Revenue's appeals failed.

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Issues: (i) Whether endorsement of "paid under protest" on the duty challans, countersigned by Central Excise officers, amounted to a valid protest payment for the purpose of refund claim; (ii) whether Rule 233B of the Central Excise Rules, 1944 was strictly applicable to cess paid under Section 3(1) of the Vegetable Oils Cess Act, 1983; (iii) whether the refund claims were barred by limitation or defeated by unjust enrichment.

Issue (i): Whether endorsement of "paid under protest" on the duty challans, countersigned by Central Excise officers, amounted to a valid protest payment for the purpose of refund claim.

Analysis: The payment of cess was made on a consolidated quarterly basis and the challans were the only documents available for recording protest. The challans bore the remark "paid under protest" and were countersigned by the departmental officers. On these facts, the protest was treated as duly recorded and accepted by the department.

Conclusion: The protest payment was valid and effective.

Issue (ii): Whether Rule 233B of the Central Excise Rules, 1944 was strictly applicable to cess paid under Section 3(1) of the Vegetable Oils Cess Act, 1983.

Analysis: The procedure under Rule 233B contemplates a protest mechanism in the context of excise clearances, whereas cess under the Vegetable Oils Cess Act was payable on a quarterly consolidated basis. The Tribunal held that the special manner of payment did not require the same clearance-document procedure and that the rule was not expressly made applicable to the cess provisions.

Conclusion: Strict compliance with Rule 233B was not required for such cess payments.

Issue (iii): Whether the refund claims were barred by limitation or defeated by unjust enrichment.

Analysis: Once the payment was accepted as made under protest, the limitation objection did not survive. The earlier factual finding that the incidence of cess had not been passed on was also left undisturbed, and the Revenue failed to show any basis to dislodge the Commissioner (Appeals)' conclusion on refundability.

Conclusion: The refund claims were not time-barred and were not hit by unjust enrichment.

Final Conclusion: The Revenue appeals failed and the order allowing the refund claims was sustained.

Ratio Decidendi: Where a statutory cess is paid on a consolidated basis and the challans, countersigned by the departmental officer, expressly record payment under protest, that endorsement can constitute sufficient protest and defeat limitation objections, even if the detailed procedure of Rule 233B is not strictly followed.

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