Mistake of law refund claims fall outside Section 11B limitation where the levy was not legally payable.

A refund claim for Education Cess and Secondary & Higher Education Cess paid on Oil Industries Development Cess was held not to be barred by the limitation in Section 11B of the Central Excise Act, 1944 where the payment had been made under a mistake of law. The Tribunal noted that the levy was later clarified as inapplicable and accepted that the amount was not legally payable. Relying on the jurisdictional High Court and supporting authorities, it treated the claim as one arising from mistaken payment rather than a normal excise refund, so the special excise limitation did not govern it and time ran from discovery of the mistake.

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Issues: Whether the refund claim for Education Cess and Secondary & Higher Education Cess paid on Oil Industries Development Cess was barred by limitation under Section 11B of the Central Excise Act, 1944 when the payment was made under mistake of law.

Analysis: The dispute turned on whether the amount paid as Education Cess and Secondary & Higher Education Cess on Oil Industries Development Cess could be treated as a refund claim governed by the special limitation under Section 11B of the Central Excise Act, 1944. The Tribunal noted that the levy itself was clarified to be inapplicable by the later circular, and that the assessee had paid the amount under a mistaken understanding of law. Relying on the binding view of the jurisdictional High Court and other supporting authorities, the Tribunal accepted that where an amount is paid under mistake of law and is not legally payable, the special limitation for refund of excise duty does not govern the claim, and the period runs from discovery of the mistake.

Conclusion: The refund claim was not hit by limitation under Section 11B of the Central Excise Act, 1944 and the objection of time bar failed.

Ratio Decidendi: A claim for refund of an amount paid under mistake of law, where the levy itself is found inapplicable, is not governed by the refund limitation under Section 11B of the Central Excise Act, 1944.

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