2017 (11) TMI 1377 - AT - Central Excise

Tribunal decision on refund claims upholds some, dismisses others, emphasizing Apex Court's time limit ruling.

The Tribunal partially allowed the department's appeal, dismissing some and upholding others. The Commissioner (Appeals) decision sanctioning refund ... Refund of the excise duty paid on steel and cement used in construction of houses, as per N/N. 32/2005-CE dated 17.8.2005 - time limitation - denial on the ground that the refund claim for the period 1.7.2005 to 30.9.2005 was filed beyond the period of 120 days - Held that: - Apex court in the case of GIRDHARI LAL AND SONS Versus BALBIR NATH MATHUR AND OTHERS [1986 (2) TMI 253 - Supreme Court of India], held that in order to avoid patent injustice or invalidation of law, strict adhering to the time limit for filing refund claims stipulated in a notification would only adversely affect the public interest and thereby defeat the very purpose of issuing N/N. 32/2005 - since the refund claim for the quarter 1.7.2005 to 30.9.2005 is beyond the time limit of one year prescribed under section 11B, refund for the period July 2005 to September 2005, rightly rejected - other refunds, being in time, is allowed - appeal allowed in part. Issues:Department's appeal against Commissioner (Appeals) order sanctioning refund claims.Analysis:The appeals filed by the department challenged the orders passed by the Commissioner (Appeals) that set aside the rejection of refund and approved the refund claims submitted by the respondents. The respondents, a non-governmental organization involved in rehabilitation and house construction in Tsunami affected areas, filed refund claims for cement and steel used in house construction under Notification No. 32/2005-CE. The department contended that the refund claims were time-barred as they were filed beyond the prescribed period of 60 days, extendable to 120 days by the Assistant/Deputy Commissioner. Show cause notices were issued to reject the claims on this ground. The refund sanctioning authority rejected part of the refunds as time-barred. However, the Commissioner (Appeals) sanctioned the refund claims, leading to the department's appeal before the Tribunal.During the hearing, the respondent's counsel referred to a previous Tribunal order in the respondent's case, stating that the time-limit in the notification is a procedural condition and non-compliance should not affect the entitlement of the community to receive relief. It was argued that refund claims filed within the time-limit specified in section 11B of the Central Excise Act should be considered timely. The department's counsel reiterated the grounds of appeal.The Commissioner (Appeals) based the decision on the Apex Court's judgment in Giridhari Lal & Son Vs. Balbir Nath Mathur & Ors., AIR 1986 SC 1499, emphasizing that strict adherence to time limits for refund claims could lead to injustice and defeat the purpose of the notification. The Tribunal agreed with this view but found the refund claim for the quarter 1.7.2005 to 30.9.2005, amounting to Rs. 61,437, to be beyond the one-year time limit under section 11B. Consequently, the respondents were deemed ineligible for this specific claim. Following the precedent set in the respondent's own case, the Tribunal concluded that the impugned order required no interference except for the mentioned refund claim. As a result, appeal No. E/160/2009 was partly allowed, while appeal No. E/161/2009 and E/599 & 657/2010 filed by the department were dismissed.The operative part of the order was pronounced in open court.