1991 (9) TMI 203 - AT - Central Excise

Refund claim allowed despite procedural shortcomings. Flexibility in rule interpretation emphasized. High Court reference dismissed.

COLLECTOR OF C. EX. Versus FOUNDRY CHEMICALS INDUSTRIES (P) LTD.

The Tribunal held that the respondents' actions, including payment under protest and compliance with Rule 233B, were sufficient to warrant a refund claim, ... Refund - Payment of duty under protest Issues:1. Interpretation of Rule under Central Excises and Salt Act, 19442. Treatment of duty paid under protest without endorsement3. Compliance with Rule 233B for duty paid under protest4. Refund claim timeline and rule applicationIssue 1: Interpretation of Rule under Central Excises and Salt Act, 1944The Collector filed an application seeking a reference to the High Court regarding the Tribunal's order dismissing an appeal. The key point was whether the Tribunal, as a creature of the Central Excises and Salt Act, could exceed the restrictions imposed under the Act for benefiting from the Rule framed. The Collector argued that the respondents did not follow the procedure under Rule 233B, leading to a limitation on their refund claim. The Senior Departmental Representative urged for the reference, citing a legal point arising from the Tribunal's order.Issue 2: Treatment of duty paid under protest without endorsementThe respondents contended that their letter to the Superintendent, stating their disagreement and intention to deposit excise duty under protest, sufficed as compliance with Rule 233B. The Collector argued that the respondents failed to endorse the Gate Passes with 'Duty paid under protest' and did not submit a detailed representation to the Assistant Collector within three months. The Tribunal analyzed the letter's content and concluded that the respondents' actions met the requirements of the Rule, even if not all aspects were fully complied with.Issue 3: Compliance with Rule 233B for duty paid under protestThe Tribunal examined whether the respondents' actions aligned with Rule 233B's provisions for paying duty under protest. It was determined that the endorsement on Gate Passes was not mandatory in this case, as the reasons for protest were clearly stated in the letter to the Superintendent. The Tribunal emphasized that the Rule's requirements were not absolute and that compliance could be established through alternative means, such as the protest letter itself. The Tribunal's decision aligned with previous legal pronouncements and held that the procedural rules should not be treated as mandatory.Issue 4: Refund claim timeline and rule applicationThe Collector argued that the respondents' refund claim, filed beyond six months from duty payment, should be disallowed due to non-compliance with Rule 233B. However, the Tribunal found that the respondents' actions, as per the letter to the Superintendent, constituted payment under protest, and thus the refund claim timeline should not be a barrier to their entitlement. The Tribunal dismissed the application for reference to the High Court, citing that the legal questions raised were clear and did not necessitate further examination.