Refund of deemed credit under Notification 29/96 not barred by limitation where no specific time limit was prescribed.

Refund of deemed credit on grey fabric used in exported processed fabric cleared under bond was held not to be barred by limitation, because Notification No. 29/96 did not prescribe any specific time limit for such refund where adjustment was not possible. The Tribunal applied the proviso to Para 3 of the notification, which allowed refund subject only to conditions and limitations specified by the Central Government in the Official Gazette, and followed its earlier view that Section 11B of the Central Excise Act, 1944, and the time limit in Notification No. 85/87-C.E. did not govern such claims. The refund claim was therefore allowed in favour of the assessee.

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Issues: Whether refund of deemed credit under Notification No. 29/96 was barred by limitation or any time limit prescribed under the Central Excise law or Notification No. 85/87-C.E.

Analysis: The refund claim arose from unutilised deemed credit on grey fabric used in exported processed fabric cleared under bond. The operative proviso to Para 3 of Notification No. 29/96 permitted refund where adjustment was not possible, subject only to such safeguards, conditions and limitations as might be specified by the Central Government in the Official Gazette. No specific time limit had been prescribed for such refund under the notification scheme. The Tribunal followed its earlier decisions holding that the limitation under Section 11B of the Central Excise Act, 1944, and the time limit under Notification No. 85/87-C.E. did not govern refund of deemed credit.

Conclusion: The refund claim was not barred by time and the appeal was allowed in favour of the assessee.

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