Refund limitation cannot be used to defeat a timely claim when departmental inaction caused the jurisdictional delay.

A refund claim filed within the prescribed period cannot be defeated by departmental inaction where the receiving Commissionerate retained it for nearly six months without rejecting it or returning it for want of jurisdiction. The authority that received the claim was expected to promptly inform the claimant to present it before the proper jurisdictional Commissionerate. Rejection of the refund as time-barred was therefore unjustified, and the claim was directed to be considered on merits by the proper Commissionerate.

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Issues: Whether the refund claim was liable to be rejected as time-barred despite being filed within the prescribed date, and whether the department could rely on delay caused by transfer between Commissionerates to defeat the claim.

Analysis: The refund application was filed before the department on 24.5.2012, which was within the due date of 26.5.2012. The record also showed that the Sea Cargo Commissionerate had received the claim and retained it for nearly six months without rejecting it or returning it for want of jurisdiction. In such circumstances, the authority receiving the claim ought to have informed the appellant promptly to present it before the correct jurisdiction. The later rejection on the ground of limitation, after departmental inaction, was therefore not justified.

Conclusion: The rejection of refund as time-barred was set aside, and the refund claim was directed to be considered on merits by the proper Commissionerate. The finding is in favour of the assessee.

Ratio Decidendi: A refund claim filed within limitation cannot be defeated where the department, after receiving it, retains it without prompt return or rejection for want of jurisdiction and later invokes delay caused by its own inaction.

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