Recovery of erroneous rebate must follow the excise statute, and the Department is bound by the statutory limitation period.

Excess rebate granted under an exemption notification was treated as an erroneous refund of duty, and recovery had to proceed under the excise statutory scheme. Where the Department invoked that scheme, it was bound by the limitation period prescribed in the Act. If it sought to avoid the statutory limitation, recovery could not be pursued by excise authorities under general law and would lie, if at all, only by civil suit, because quasi-judicial officers must act within the Act. On that basis, the demand in the manner adopted by the Department could not be sustained.

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Issues: Whether the demand for recovery of excess rebate was barred by limitation and whether the Department could recover the amount outside the statutory scheme.

Analysis: The excess rebate granted under the exemption notification was treated as an erroneous refund of duty. The authority and procedure for recovery of such excess payment were held to lie under the excise statutory provisions, and if the Department chose to proceed under that route it was bound by the limitation prescribed therein. The Tribunal also held that if the Department's case was that the statutory limitation did not apply, recovery could not be pursued by the excise authorities under general law, but only by a civil suit, since quasi-judicial officers must act within the Act.

Conclusion: The demand could not be sustained in the manner adopted by the Department, and the appeal was allowed.

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