2022 (5) TMI 8 - HC - Central Excise

Appeal Dismissed: Procedural Compliance Key in Excise Refund Claims

The court dismissed the appeal, affirming the restoration of the Assessing Authority's rejection of excise refund claims. It held that the appellant ... Rejection of refund claim - eligible exemption, after the expansion of the installed capacity in their factory in terms of N/N. 33/99-CE dated 08.07.1999 - procedural lapses - applicability of time limitation - HELD THAT:- A perusal of the Notification No. 33/99-CE dated 08.07.1999 reveals that the procedure for claiming exemptions under the notification is provided for under Clause-2 of the said Notification. Clause 2(a) provides that a statement of duty paid from the account current is to be submitted by the manufacturer (the appellant herein) to the Assistant Commissioner or Deputy Commissioner as the case may be, by the 7th of the next month in which the duty has been paid other than the amount of difference paid by utilization of CENVAT credit under CENVAT Rules, 2001. In view of the procedures laid down by the Notification No. 33/99-CE dated 08.07.1999 under Clause 2(A) of the said Notification, it is clear that refunds are to be claimed by filing a statement of duty paid to the Assistant Commissioner or Deputy Commissioner of Central Excise as the case may be, by the 7th of next month by the manufacturer - Although in the show-cause reply, it is stated that RT-12 Returns were regularly filed but there is no pleading with regard to any statement of fact as to whether the RT-12 Returns filed by the appellant/assessee were as per the procedure prescribed under Clause-2(a) of the Notification No. 33/99-CE dated 08.07.1999. There is completely no statement to that effect. Rather categorical statement is made in the show-cause reply that because of different stands taken by the Department at different times the manufacturer/appellant did not submit their claims at the relevant point in time. Applicability of time limitation under Section 11B of the Central Excise Act, 1944 - HELD THAT:- In the proceedings before the Department there is no finding that the procedure prescribed under Clause 2(a) of the Notification No. 33/99-CE dated 08.07.1999 had been duly followed by the appellant. Rather in its reply to the show-cause Notice, the appellant only cited reasons for late filing of its refund claims. In the facts of the present case, there are no clear averments made by the appellant that conditions prescribed under Clause 2(A) of the Notification No. 33/99-CE dated 08.07.1999 has been fulfilled by the appellant. Rather entire thrust of the appellant’s case is that notwithstanding the delay of about nine (9) years in claiming the refund, since limitation under Section 11B of the Central Excise Act, 1944 is not attracted for claiming benefits under the notification, the appellant is entitled to the refund claims made. Since in the absence of facts necessary not pleaded and no finding of fact being returned by the Departmental Authorities as well as by the CESTAT, no substantial question of law arises - Appeal dismissed. Issues Involved:1. Correct appreciation of Notification No. 33/99-CE dated 08.07.1999.2. Applicability of limitation under Section 11B of the Central Excise Act, 1944.3. Denial of excise refund benefit due to delay in filing statements.4. Denial of refund based on procedural lapses.5. Consistency with earlier Tribunal decisions on similar issues.Detailed Analysis:1. Correct Appreciation of Notification No. 33/99-CE dated 08.07.1999:The appellant sought exemption from duties of excise under Notification No. 33/99-CE, claiming a 53% increase in installed capacity. The CESTAT restored the Assessing Authority's rejection of the refund claims on the grounds of limitation. The appellant argued that the rejection was unjustified as the Central Board of Excise & Customs had clarified that Section 11B limitations were not applicable to refunds under this notification.2. Applicability of Limitation under Section 11B of the Central Excise Act, 1944:The appellant contended that the limitation period under Section 11B was inapplicable to their refund claims. The court noted that while Section 11B limitations do not apply, the procedural requirements under Notification No. 33/99-CE must still be followed. The appellant failed to submit the required statement of duty paid by the 7th of the next month, as mandated by the notification.3. Denial of Excise Refund Benefit Due to Delay in Filing Statements:The appellant's refund claims were submitted approximately nine years after the expansion, which the Department argued was too late. The court upheld that despite the non-applicability of Section 11B, the appellant did not meet the procedural requirements of Notification No. 33/99-CE, specifically the timely submission of duty statements.4. Denial of Refund Based on Procedural Lapses:The court emphasized that procedural requirements under Notification No. 33/99-CE cannot be waived unilaterally by the manufacturer. The appellant's failure to follow the prescribed procedure, including timely filing of duty statements, justified the denial of the refund claims.5. Consistency with Earlier Tribunal Decisions on Similar Issues:The appellant referenced a previous High Court judgment in M/s M.K. Jokai Agri Plantations (P) Ltd, which held that refund claims under Notification No. 33/99-CE could not be denied on the grounds of limitation if procedural conditions were met. However, the court found that the appellant did not fulfill these conditions, distinguishing this case from the Jokai judgment.Conclusion:The court concluded that the appellant did not adhere to the procedural requirements of Notification No. 33/99-CE, specifically the timely submission of duty statements. As such, the appeal was dismissed, affirming the CESTAT's decision to restore the Assessing Authority's rejection of the refund claims. The court held that no substantial question of law arose, emphasizing the importance of following procedural requirements in revenue matters.