2021 (4) TMI 1164 - HC - Central Excise

Court rules buyer not entitled to refund due to late claim filing under Section 11B. Compliance with time limit crucial.

M/s. Mahanadi Coalfields Ltd., Orisa Versus The Customs, Excise and Service Tax Appellate Tribunal, Chennai-6, The Commissioner of Central Excise

The High Court dismissed the appeal, ruling that the buyer was not entitled to a refund as the claim was filed beyond the six-month limitation period ... Refund claim - Applicability of Doctrine of unjust enrichment - manufacturer paid the differential disputed excise duty under protest when the assessment was finalized in favour of the manufacturer - HELD THAT:- Indisputably, the application was filed by the appellant as a buyer of the goods from the supplier namely the said M/s.Fenner India Ltd., which paid duty under protest after the period of limitation prescribed in law and therefore, this would dis-entitle the claim of refund to the assessee as prayed for by applying the law laid down by the Hon’ble Supreme Court in the case of COMMISSIONER OF C. EX., MUMBAI-II VERSUS ALLIED PHOTOGRAPHICS INDIA LTD. [2004 (3) TMI 63 - SUPREME COURT], wherein it was held that the purchaser of the goods was not entitled to a claim for refund of duty made under protest by the manufacturer without complying with the mandate of Section 11B of the Act. The appellant – assessee has not made out any case to interfere with the impugned order passed by the Tribunal - Appeal dismissed and the substantial questions of law framed are answered against the assessee. Issues Involved:1. Applicability of the protest lodged by the manufacturer to the refund claim made by the buyer.2. Determination of limitation under Section 11B when duty is paid under protest.3. Applicability of Supreme Court decisions in the context of refund claims under Section 11B.Issue-wise Detailed Analysis:1. Applicability of the Protest Lodged by the Manufacturer to the Refund Claim Made by the Buyer:The appellant purchased colliery conveyor belting from a supplier who paid higher duty under protest. The classification dispute was resolved in favor of the supplier by the Supreme Court. The appellant filed for a refund based on this decision but was denied on the grounds of not providing original duty-paid documents, the original protest letter, and evidence that the duty burden was not passed to customers. The Tribunal upheld this denial, leading to the present appeal.2. Determination of Limitation under Section 11B When Duty is Paid Under Protest:The appellant argued that the limitation of six months under Section 11B should not apply as the duty was paid under protest by the supplier. The Supreme Court in Allied Photographics India Ltd. clarified that Section 11B and Rule 9B operate in different spheres. Payment under protest falls under Section 11B, and the buyer must comply with its provisions, including the six-month limitation. The Supreme Court further distinguished between the rights of the manufacturer and the buyer under Section 11B, emphasizing that the buyer must file for a refund within six months from the date of purchase.3. Applicability of Supreme Court Decisions in the Context of Refund Claims under Section 11B:The appellant relied on the decision in National Winder, which was held per incuriam by the Supreme Court in Allied Photographics India Ltd. The Supreme Court in Allied Photographics India Ltd. held that the buyer must comply with Section 11B's provisions, including the six-month limitation, even if the duty was paid under protest by the manufacturer. This position was reaffirmed in Western Coalfields Ltd., where the Supreme Court held that applications filed by buyers much after the six-month period were time-barred.Conclusion:The High Court, following the Supreme Court's decisions in Allied Photographics India Ltd. and Western Coalfields Ltd., dismissed the appeal, holding that the appellant, as a buyer, was not entitled to a refund as the claim was filed beyond the six-month limitation period prescribed under Section 11B. The substantial questions of law were answered against the assessee, and the Tribunal's order was upheld.