Excise duty refund on post-clearance price reduction is unavailable without provisional assessment under the prescribed procedure.

Refund of excise duty arising from a post-clearance downward price revision was held not maintainable where the goods were not cleared under provisional assessment. The Tribunal applied the settled principle that provisional assessment must be undertaken in the prescribed manner before a later price reduction can justify adjustment of duty. Because the assessee had cleared goods under contracts with a price variation clause but without following provisional assessment procedure, the differential duty could not be refunded. The rejection of the refund claims was therefore upheld.

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Issues: Whether refund of excise duty paid on account of downward price revision under a price escalation clause is admissible when the clearances were not made under provisional assessment.

Analysis: The appellant cleared the goods on the basis of supply contracts containing a price variation clause and later sought refund of the differential duty when the final price settled lower than the price initially adopted. The Tribunal noted that the department had rejected the claims because the assessments were not provisional. Relying on the settled principle that provisional assessment requires compliance with the prescribed procedure, and following the view that a subsequent reduction in price cannot by itself support refund where the goods were not cleared provisionally, the Tribunal held that the absence of provisional assessment was .

Conclusion: The refund claims were not maintainable and the rejection orders were upheld against the assessee.

Ratio Decidendi: Refund of excise duty on account of post-clearance price reduction is not admissible unless the clearances were made under provisional assessment in accordance with the prescribed procedure.

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