Refund under excise law cannot be denied for failure to separately appeal a non-appealable capacity determination.

Refund of excise duty paid under protest could not be denied merely because the order determining annual production capacity was not separately appealed. The Tribunal followed the jurisdictional High Court view that, where the capacity determination under the compounded levy scheme was not an independently appealable order, the assessee was not required to challenge it separately before claiming refund under Section 11B of the Central Excise Act, 1944. The earlier rejection of refund on that ground was therefore incorrect, and the refund claim was held maintainable.

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Issues: Whether refund of excise duty paid under protest could be denied on the ground that the order determining annual production capacity was not separately appealed.

Analysis: The dispute arose from determination of annual production capacity under the compounded levy scheme for processed man-made fabrics. The duty was paid under protest after the gallery length was included in the chamber length. The Tribunal followed the binding jurisdictional High Court view that where the determination of annual production capacity was not an appealable order, the assessee was not required to challenge it separately before seeking refund under Section 11B of the Central Excise Act, 1944. The earlier rejection of refund merely because the capacity determination was not independently appealed was therefore incorrect.

Conclusion: The refund claim was maintainable and the objection based on non-filing of a separate appeal against the capacity determination was rejected.

Final Conclusion: The Revenue's appeal failed, and the order granting refund was sustained.

Ratio Decidendi: Where the order determining annual production capacity is not separately appealable, refund of duty paid under protest cannot be denied solely because that order was not independently challenged.

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