1998 (9) TMI 234 - AT - Central Excise

Manufacturer entitled to refund despite procedural lapses; Tribunal upholds decision.

COMMR. OF C. EX., MEERUT Versus SAHIBABAD DYEING & PRINTING MILLS (P) LTD.

COMMR. OF C. EX., MEERUT Versus SAHIBABAD DYEING & PRINTING MILLS (P) LTD. - 1999 (107) E.L.T. 441 (Tribunal) Issues:- Demand of duty under show cause notice- Imposition of penalty by Asstt. Commissioner- Appeal to Commissioner of Central Excise (Appeals)- Refund of excess duty paid- Procedure for claiming refund- Penalty for not following proper procedureAnalysis:1. The appeal concerns a demand of duty of Rs. 14,249 under a show cause notice, with the Asstt. Commissioner dropping the demand but imposing a penalty of Rs. 500. The Commissioner of Central Excise (Appeals) upheld the decision, acknowledging the mistake in printing a notification that led to overpayment of duty by the manufacturer. The Commissioner noted the issuance of credit notes by the manufacturer for the excess amount and their application for refund through the RT-12 return, albeit without permission, leading to the imposition of a penalty for procedural violations.2. The Revenue contended that the manufacturer did not follow the prescribed procedure for refunding duty, as they did not submit an application in the proper format and took credit for excess duty payment independently. The Revenue argued that the refund was not admissible due to these deviations from the established process.3. Despite the absence of representation from the manufacturer, M/s. Sahibabad Dyeing & Printing Mills (P) Ltd., the tribunal proceeded to examine the case based on undisputed facts. It was established that the manufacturer had paid duty at a higher rate due to a misprinted notification, which was later rectified. The manufacturer sought permission to credit the excess amount paid, which was utilized towards central excise duty without prior authorization, resulting in the penalty imposition.4. The tribunal acknowledged that the manufacturer had indeed overpaid duty due to a printing error in the notification, making them eligible for a refund. Both the Asstt. Commissioner and the Commissioner of Central Excise (Appeals) had concurred on the eligibility for a refund, despite the penalty for procedural lapses. The tribunal found no grounds to overturn the decision of the Commissioner and rejected the Revenue's appeal.5. Considering all pertinent details and circumstances specific to the case, the tribunal upheld the decision of the Commissioner of Central Excise (Appeals) in deeming the manufacturer eligible for a refund despite procedural shortcomings. The tribunal found no merit in the Revenue's appeal and dismissed it accordingly, affirming the entitlement of M/s. Sahibabad Dyeing & Printing Mills (P) Ltd. to the refund of excess duty paid.