Retrospective excise refund rules require proof that duty was not passed on before any refund is granted.

Section 11B of the Central Excises and Salt Act, 1944 was treated as retrospective and applied to refund claims relating to periods before 20 September 1991. Refund entitlement was made conditional on proof that the duty incidence had not been passed on to the buyer, in line with binding Supreme Court rulings. The finding on illegality of the duty recovery remained undisturbed, but the actual refund was left for determination under the amended statutory scheme by the Assistant Collector.

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Issues: Whether the amended Section 11B of the Central Excises & Salt Act, 1944 applies retrospectively to refund claims arising before the amendment.

Analysis: The amendment to Section 11B was held to govern refund claims even in respect of periods preceding 20 September 1991. The Court applied the binding Supreme Court decisions recognising the retrospective operation of the provision and requiring proof that the incidence of duty had not been passed on to the buyer before refund could be granted.

Conclusion: Section 11B of the Central Excises & Salt Act, 1944 is retrospective.

Final Conclusion: The finding on illegality of the duty recovery was left undisturbed, while the entitlement to refund was left to be determined by the Assistant Collector in accordance with the amended statutory scheme and the Supreme Court rulings.

Ratio Decidendi: An amended refund provision in central excise law operates retrospectively where the Supreme Court has so declared, and refund is contingent upon proof that the duty burden was not passed on.

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