Excise duty refund under exemption notification not time-barred where entitlement could be ascertained only after year-end.

An exemption notification for electrical stampings and laminations operated up to specified clearance quantities in a financial year, so entitlement to refund could be ascertained only after year-end when total production was known. On that basis, the refund claim arose when the assessee could determine whether the exemption limit had been exceeded, not from each individual duty payment on initial clearances. The departmental limitation theory was inconsistent with the structure of the notification and the way the exemption functioned. The refund claims were therefore held not to be time-barred, and refund of duty paid on exempt clearances was allowed.

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Issues: Whether the assessee was entitled to refund of excise duty under the exemption notification, and whether the refund claims were barred by limitation.

Analysis: The notification granted exemption up to specified quantities of electrical stampings and laminations cleared in a financial year, and the question whether the total production would exceed the threshold could be determined only at the end of the financial year. The refund claim therefore arose only when the assessee could ascertain its entitlement under the notification. The departmental view that limitation ran from each payment of duty on the initial clearances was inconsistent with the scheme of the notification and with the manner in which the exemption operated.

Conclusion: The refund claims were not time-barred, and the assessee was entitled to refund of the duty paid on the exempt clearances.

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