Excess excise duty refund on texturised yarn allowed where exemption depended on denier count and higher duty had been paid.

Excess excise duty paid on texturised polyester yarn was recoverable where the applicable exemption notification turned on denier count and the assessee had paid duty at a higher rate than the one applicable to yarn of 100 deniers and above but not above 750 deniers. The excess basic excise duty collected for the relevant period was treated as refundable, but the broader claim for additional excise duty and special duty of excise was not sustained. The effect of later legislation was left for departmental determination.

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Issues: Whether the petitioners were entitled to refund of excess excise duty paid on texturised yarn on the basis of the exemption notification applicable to yarn of the relevant denier count.

Analysis: The duty payable depended on the denier count of the polyester yarn. The relevant exemption notification provided a lower rate for yarn of 100 deniers and above but not above 750 deniers, while the petitioners had paid duty at the higher rate applicable to yarn of 75 deniers and above but below 100 deniers. The Court accepted that the excess collected for the relevant period was liable to be refunded. The claim relating to additional excise duty and special duty of excise was not sustained, and the issue concerning the effect of later legislation was left for determination by the Department.

Conclusion: The petitioners were held entitled to refund of the excess basic excise duty shown in Exhibit G, while the larger refund claim shown in Exhibit F was rejected.

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