Refund of duty deposited under protest cannot be treated as premature without a live show cause notice or pending adjudication.

Where duty is deposited under protest pursuant to departmental direction, a refund claim cannot be rejected as premature unless a live show cause notice or pending adjudication exists at the time of the claim. The record showed no such pending proceedings concerning alleged wrongful availment of Cenvat credit when refund was sought, and a later show cause notice did not cure that absence. The Department could not retain the amount indefinitely on a mere possibility of future action, so the refund was held maintainable and the assessee was entitled to it.

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Issues: Whether the refund claim of duty amount deposited under protest could be rejected as premature in the absence of any show cause notice or pending adjudication proceedings.

Analysis: The amount was deposited under protest pursuant to departmental direction. The record before the adjudicating authority and the appellate authority did not show issuance of any show cause notice or pendency of proceedings concerning alleged wrongful availment of Cenvat credit at the relevant time. The later issuance of a show cause notice and the recorded statement relied upon by the Department did not establish that any adjudication was pending when the refund was sought. In such circumstances, the Department could not retain the amount indefinitely merely on the possibility of initiating proceedings at a later stage, and the refund claim could not be treated as premature.

Conclusion: The refund claim was not premature, and the assessee was entitled to refund.

Final Conclusion: The appeal failed, and the refund granted by the Commissioner (Appeals) was sustained.

Ratio Decidendi: A refund claim for duty deposited under protest cannot be rejected as premature unless there is a live show cause notice or pending adjudication concerning the demand at the time of the refund claim.

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