Excess excise duty refund allowed where Rule 56A does not bar cash refund of finished goods duty under Section 11B.

Rule 56A(3)(vi)(b) bars cash refund only of proforma credit as such and does not prohibit refund of excess excise duty paid on finished goods where duty was discharged through utilisation of that credit. The claim therefore fell to be examined under the amended refund scheme in Section 11B of the Central Excise Act, 1944, including the statutory presumption under Section 12B that duty has been passed on. The refusal to grant cash refund under Rule 56A was unsustainable, but any refund remained subject to the requirements of Section 11B and the incidence-of-duty rule.

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Issues: Whether refund of excess excise duty paid on the finished product could be granted in cash despite Rule 56A(3)(vi)(b), and whether the claim was governed by the amended refund provisions in Section 11B of the Central Excise Act, 1944.

Analysis: The claim arose from excess duty paid on the final product, not from a claim to recover proforma credit itself. Rule 56A(3)(vi)(b) bars only refund in cash or by cheque of part of the proforma credit allowed on inputs; it does not prohibit refund of excess duty paid on the finished goods where the duty had already been discharged by utilisation of proforma credit. The reasoning in the cited High Court decisions supported the distinction between a cash refund of excess duty and refund of proforma credit as such. The amended refund scheme under Section 11B applied to the claim, and the presumption under Section 12B that the duty burden is passed on could not be ignored.

Conclusion: The denial of cash refund under Rule 56A(3)(vi)(b) was unsustainable, and the assessee was entitled to refund in accordance with Section 11B of the Central Excise Act, 1944, subject to the statutory refund requirements.

Final Conclusion: The appeal succeeded to the extent that the order refusing cash refund under Rule 56A was set aside, but the refund remained subject to the governing refund provisions and the incidence of duty rule under the amended law.

Ratio Decidendi: Rule 56A(3)(vi)(b) forbids cash refund of proforma credit as such, but does not bar refund of excess duty paid on the final product, which is to be considered under Section 11B of the Central Excise Act, 1944.

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