Refund of excess excise duty after exemption notification: Rule 11 limitation does not bar writ relief for unlawful collection.

An exemption notification under Rule 8(1) reduced excise duty on organic surface active agents from 20% to 15%, and duty collected above the exempted rate after the notification was treated as collected without authority of law. The assessee's refund claim was based on payment under mistake of law, as the notification had already come into force when the excess duty was paid. In writ proceedings under Article 226, the limitation in Rule 11 of the Central Excise Rules, 1944 does not bar relief where the levy itself was unauthorised. The rejection of refund was therefore quashed, and entitlement to refund was recognised.

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Issues: Whether the refund claim for excess excise duty paid on the strength of an exemption notification was barred by limitation under Rule 11 of the Central Excise Rules, 1944 in proceedings under Article 226 of the Constitution of India, and whether the excess duty recovered after the notification was without authority of law.

Analysis: The exemption notification issued under Rule 8(1) of the Central Excise Rules, 1944 reduced the duty on organic surface active agents from 20% to 15% ad valorem. Once the notification was published, the Department had no authority to recover duty above the exempted rate. The refund claim arose from excess duty paid because the assessee was unaware of the notification, which constituted payment under mistake of law. In writ proceedings under Article 226, the limitation in Rule 11 does not govern the court's power to grant relief where duty has been collected without authority of law.

Conclusion: The refund was not barred by Rule 11, and the excess duty was recoverable by the assessee as duty collected without authority of law.

Final Conclusion: The impugned rejection of refund was quashed and the assessee was held entitled to refund of the excess duty, though actual repayment was not directed in these proceedings.

Ratio Decidendi: Limitation under Rule 11 of the Central Excise Rules, 1944 does not preclude relief under Article 226 of the Constitution of India where excise duty has been collected in excess of the lawful rate after an exemption notification has come into force and the payment was made under mistake of law.

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