Refund of duty paid in error on unrealised exports treated as timely, with limitation under Central Excise law held inapplicable.

Duty debited on export invoices issued in anticipation of export was held refundable where the export order was cancelled and the goods were never removed from the factory. The department could not defeat the claim on limitation merely because the appellant sought recredit through a request letter rather than a formal refund application, since the appellant had promptly informed the department and the payment was made in error. Section 11B of the Central Excise Act, 1944 was held inapplicable because the amount was not legally retainable. The request letter was directed to be treated as a refund application, and refund was held admissible.

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Issues: Whether the appellant's request for recredit or refund of duty paid on invoices for goods that were not removed from the factory could be rejected as time-barred under Section 11B of the Central Excise Act, 1944.

Analysis: The duty had been debited on export invoices issued in anticipation of export, but the export order was cancelled and the goods were never removed from the factory. The appellant had promptly informed the department and sought recredit. The failure of the department to guide the appellant to file a formal refund claim could not be used to defeat the claim on limitation. Since the payment was made in error and the amount was not legally retainable, the limitation under Section 11B was held inapplicable to the claim.

Conclusion: The claim was not barred by limitation and the request letter was directed to be treated as a refund application. The appeal was allowed and refund was held admissible.

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