TaxTMI 
TaxTMI 
2017 (6) TMI 857
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....der Section 5A(1) of the Central Excise Act, the respondent assessee is eligible for exemption of special excise duty of 16% advalorem, if condition No.40 of the notification is fulfilled and also prescribes the procedure for availing the concessionary rate, which is to be claimed as a refund. The respondent assessee has been claiming refunds on the cars registered as taxi. It is stated that the refund claims were filed by the respondent assessee, after the expiry of six months from the date on which the duty was paid on the motor vehicles. Therefore, the Assistant Commissioner of Central Excise, Chengalpattu Division issued three show cause notices vide C.No.V/87/18/222/01-RF dated 14.03.2002 read with corrigendum dated 07.05.2002, C.No. C.No.V/87/18/260/02-RF dated 07.05.2002 and C.No.V/87/18/ 303/02-RF dated 11.06.2002 proposing to disallow the claims as time barred. All the three shows cause notices were adjudicated vide a common Order in Original No.48/2002 dated 20.11.2002 and the adjudicating authority, rejected 31 claims for Rs. 22,95,991 as time barred and partially rejected Rs. 8,03,833 relating to 6 claims and the respondent assessee was sanctioned with the eligible clai....
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....ntry in column (5) of the said Table, subject to the relevant conditions specified in the annexure to this Notification, and referred to in the corresponding entry in column (6) of the said Table; Explanation ,- For the purpose of this notification, the rates specified in column (4) and (5) of the said Table are ad valorem rates, unless otherwise specified :- TABLE S. No. Chapter of heading No Or Sub heading No Description of goods Rate Under the first Schedule Rate Under the Second Schedule Condition No (1) (2) (3) (4) (5) (6) 225 87 Motor Vehicle falling under- (i) sub-heading No.8702.10 16% Nil 40 or 8703.90, which after clearance has been registered for use solely as ambulance; or (ii) sub-heading No.8703.90 16% Nil which after clearance has been registered for use solely as taxi. 16% Nil The relevant portion, in condition 40 of the Notification, is extracted below :- (a) .... (b) the manufacturer files the claim for refund of duty paid in excess of that specified under this exemption, in the proforma prescribed under rule 173S of the Central Excise Rules, 1944, with the Deputy Commissioner of Central Excise or the....
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....V/87/18/260/02-RF and V/87/18/303/ 02-RF, were issued to the respondent assessee informing as to why the refund claims mentioned in the notices should not be rejected, on the ground that claims of refund of duty paid in excess have been filed beyond the period of six months from the date of receipt of payment of duty of the said motor vehicles and thereby all the claims are time barred. 6. In reply to the three show cause notices, the respondent assessee by their letters dated 04.06.2002 and 14.06.2002 have interalia submitted that they sell the cars to their dealers on payment of applicable excise duty of 32% advalorem and the dealers in turn sell the cars to various customers. Some of the cars sold to the customers are subsequently registered as Taxis and hence are eligible for concessional rate of duty @ 16% vide Notification No.3/2001-CE dated 01.03.2001 under Sl. No.225 read with condition No.40 of the said notification. As required under the notification, for the cars registered as Taxis, necessary documents are being submitted by the respective customers and then the claims are filed by the assessee, as required under the notification, with all the supporting documents. Wit....
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.... be held to be time barred, for the only reason that they were filed beyond the period prescribed under the notification. Challenging the same, the instant appeal has been preferred by the Revenue, before this Court. 8. Heard Mr. A.P. Srinivas, Senior Standing Counsel and Mr. Raghavan Ramabadran for Mr. Lakshmikumaran, learned counsel for the respondent. 9. The following substantial questions of law were framed by this Court, at the time of admission of this Appeal : 1.Whether Notification No.3/2001 dated 01.03.2001 (Sl.No.225 read with condition 40) is a special provision for a specific purpose comprising a self contained code governing the procedure and conditions for grant of refund in respect of vehicles registered as taxis and ambulances ? 2.Whether the Tribunal was correct in applying the time limit specified in the general provision of Section 11B of the Central Excise Act, 1944 in preference to the time limit contained in the special provision contained in Notification 3/2001 particularly in view of the observation of the Hon'ble Supreme Court in the case of Raghuvar (India) Ltd. reported in 2000 (118) ELT 311 (SC) that the provisions of the special scheme alone w....
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....on of the respondent assessee that the instant case relates to the determination of rate of duty of excise and so the appeal will not lie within the jurisdiction of this court, cannot be accepted. The respondent assessee has claimed refund of excise duty by accepting the conditions prescribed in the notification No.3/2001 dated 01.03.2001. Without challenging the said notification, the respondent assessee cannot have any right to claim the refund under Section 11B of the Act. 11. Therefore, we are now considering the other issues involved in the appeal, as to whether the time limit of six months under the notification is only a procedural condition or is it mandatory? All the conditions in the notification have been complied with, by the respondent assessee, except Clause 40(b). Therefore, non compliance of the same, is only a procedural lapse and it can be relaxed. In this regard the decisions, in the case of Indian Farmers Fertilizers Co-operative Ltd. vs. Union of India [1995 (75) ELT 218 (Gujarat)] and Commissioner of Central Excise vs. Exide Industries Ltd. [2009 (247) ELT 87 (Calcutta)], are relied. In the aforesaid decisions, which are strongly relied upon by the respondent....
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....urrent maintained with the [Commissioner of Central Excise]; (c) refund of credit of duty paid on excisable goods used as inputs in accordance with the rules made, or any notification issued, under this Act; (d) the duty of excise paid by the manufacturer, if he had not passed on the incidence of such duty to any other person; (e) the duty of excise borne by the buyer, if he had not passed on the incidence of such duty to any other person; (f) the duty of excise borne by any other such class of applicants as the Central Government may, by notification in the Official Gazette, specify : Provided further that no notification under clause (f) of the first proviso shall be issued unless in the opinion of the Central Government the incidence of duty has not been passed on by the persons concerned to any other person. (3) Notwithstanding anything any judgment, decree, order or direction of the to the contrary contained in Appellate Tribunal or any Court or in any other provision of this Act or the rules made thereunder or any other law for the time being in force, no refund shall be made except as provided in sub-section (2). (4) Every notification under proviso to sub-sect....
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.... (d) in a case where a manufacturer is required to pay a sum, for a certain period, on the basis of the rate fixed by the Central Government by notification in the Official Gazette in full discharge of his liability for the duty leviable on his production of certain goods, if after the manufacturer has made the payment on the basis of such rate for any period but before the expiry of that period such rate is reduced, the date of such reduction; (e) in the case of a person, other than the manufacturer, the date of purchase of the goods by such person;] in the case of goods which are exempt from payment of duty (eb) this Act or the rules made thereunder, the date of adjustment of duty after the final assessment thereof; (ec) in case where the duty becomes refundable as a consequence of judgment, decree, order or direction of appellate authority, Appellate Tribunal or any court, the date of such judgment, decree, order or direction;] (f) in any other case, the date of payment duty.] In the case of Mafatlal Industries Ltd. vs. Union of India [1997 (89) ELT 247 (SC), the Hon'ble Supreme Court has held that all refunds are governed by the provisions of Section 11B. As per ....
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....tion 2 to sub-section (1) of section 3. Therefore, the notification under dispute provides partial exemption of excise duty, on fulfilment of conditions. Condition No.40(b) of the notification provides that the claim for refund of duty has to be filed before the expiry of six months, from the date of payment of excise duty on the said motor vehicle. Condition 40(c) states that the certificate issued by the State Transport Authority has to be filed within three months or in the extended period of further three months, from the date of clearance of the said motor vehicle from the factory. Condition 40(d) provides that when the excise duty has been collected from the customers in excess, of the exemption notification then the same has to be returned to the customers and the evidence has to be submitted to the Deputy Commissioner or Assistant Commissioner of Central Excise, to the effect that the said amount has been duly returned to the buyer. 13. Therefore, the above procedure clearly shows that the notification is a complete code by itself and operates on its own. Section 5A authorises the issuance of such notification with such conditions and the source of granting absolute or pa....
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....cannot be put against the importer and could be taken only to be directory in nature. But, the said contention was repelled by the Bombay High Court. 36. In Thermax Private Limited Vs. the Collector of Customs [MANU/SC/ 0209 /1993 : 1992 (4) SCC 440], the assessee, who imported certain goods from Japan for the purpose of using the same for refrigeration/air conditioning of two factories, claimed the benefit of two exemption Notifications bearing Nos. 93/76 and 63/85, which provided concession of 25% ad valorem. The Notifications stipulated two conditions to be fulfilled namely, (a) that the parts indicated therein should be used for refrigeration and air conditioning appliances in any one of the places set out in the Table and (b) that the procedure specified in Chapter X of the Central Excise Rules, 1944 had been followed. The importer, admittedly, fulfilled one of the conditions. The importer used the parts indicated in the Notification for setting up refrigeration or air conditioning appliances or machinery in one of the places set out in the Notification itself. But, the assessee obviously could not specify the second of the conditions, as the same was attracted only when the....
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....mpting provision in a taxing statute should be construed strictly and it is not open to the Court to ignore the conditions prescribed in the Industrial Policy and the exemption Notifications. 25. In our view, the failure to comply with the requirements renders the writ petition filed by the respondent liable to be dismissed. While mandatory rule must be strictly observed, substantial compliance might suffice in the case of a directory rule. 26. Whenever the statute prescribes that a particular act is to be done in a particular manner and also lays down that failure to comply with the said requirement leads to severe consequences, such requirement would be mandatory. It is the cardinal rule of the interpretation that where a statute provides that a particular thing should be done, it should be done in the manner prescribed and not in any other way. It is also settled rule of interpretation that where a statute is penal in character, it must be strictly construed and followed. Since the requirement, in the instant case, of obtaining prior permission is mandatory, therefore, non-compliance of the same must result in cancelling the concession made in favour of the grantee-the respo....
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....ch Notifications. This is so held by this Court in Rajasthan Spinning and Weaving Mills, Bhilwara, Rajasthan v. Collector of Central Excise, Jaipur, Rajasthan MANU/SC/0729/1995 : (1995) 4 SCC 473, wherein this principle was stated in the following manner: 16. Lastly, it is for the Assessee to establish that the goods manufactured by him come within the ambit of the exemption notification. Since, it is a case of exemption from duty, there is no question of any liberal construction to extent the term and the scope of the exemption notification. Such exemption notification must be strictly construed and the Assessee should bring himself squarely within the ambit of the notification. No extended meaning can be given to the exempted item to enlarge the scope of exemption granted by the notification. 19. This principle has been reiterated time and again. It is not necessary to take note of all such cases. We would however like to reproduce the restatement of this member by the Constitutional bench of this Court in Commissioner of Central Excise, New Delhi v. Hari Chand Shri Gopal and Ors. (2001) 1 SCC 236, as follows: 29. The law is well settled that a person who claims exemption o....