ORDER
V.P. Gulati, Member (T)
1. This Reference Application arises out of the order of the Tribunal bearing No. 536/92. The following question of law has been urged by the appellants:
Whether the Hon’ble Tribunal was right in holding that “if any recovery of refund has to be allowed it should be within six months, be it under Section 35E or under Section 11 A” in the context of the fact that notice of the departmental appeal was served on the applicant within six months under Section 35E(4) of the C.E. Act.
2. The learned Advocate for the appellants pleaded that the short point that falls for consideration is whether in the absence of a notice issued under Section 11 A, proceedings drawn under Section 35E of the Central Excise Act could be taken to be a substitute for the notice required under Section 11A for recovery of erroneous refund. He pleaded that the Tribunal has relied upon the earlier decision in the case of Universal Radiators Ltd. reported in 1988 (18) ECR 448. He pleaded that the subsequent ruling of the Madras High Court in Writ Petition No. 567/1984 in the case of Sivanandha Pipe Fittings Ltd. v. Supdt. of Central Excise and Ors. reported in 1994 (53) ECR 146 (Madras) the position to be read otherwise and the notice under Section 11A would be required to be issued. He, in this connection referred to para 19 which is reproduced below for convenience of reference:
19. Consequently, in my view, there is absolutely no warrant or justification to restrict the scope and amplitude of the powers of the Collector of Appeals under Section 35E by reading into it the provisions of Section 11A of the Act. Such a construction is not permissible under any known or well accepted principles of interpretation governing similar provisions, particularly in a fiscal enactment and while construing provisions meant to prevent evasion of Tax liability. The plea that Section 11A is a special provision and therefore cannot be allowed to be overtaken by Section 35E or that Section 11A is a substantive provision unlike a procedural provision of the nature in Section 35E has no rhyme or reason. An appellate or Revisional provision is as much a provision of law conferring substantive rights as a provision regulating refund or recovery of an amount erroneously refunded. The decisions of the Apex Court were concerned with the scope of Section 11A only and they have not dealt with the relative scope of Section 11A and the other provisions or the issue as to whether the provisions in Section 11A have overriding effect on the provisions in Section 35A or 35E or even as to whether Section 11A has to be dovetailed into Section 35A and 35E of the Act, in cases of recovery of erroneous refund of duty. Consequently, these decisions cannot be the authority to support the stand of the petitioners. For all the reasons stated above, I am unable to subscribe to the view expressed by the Calcutta High Court or the CEGAT Bench at New Delhi, relied upon for the petitioners.
He also referred us to the judgment of the Tribunal in the case of India Cements v. Collector of Central Excise .
3. The learned DR has pleaded that the Tribunal followed the earlier decision in the case of Universal Radiators and that sets the correct position in law act there is no question of law arises for reference.
4. We observe that under Section 35E the power has been conferred with the superior authorities to rectify any mistake committed by the lower authority in the matter of any decision or order passed. This supervisory power has to be taken to be for the purpose of setting right the mistake i.e. if under an order erroneous refund has been given, the order passed under 35E would be only to set aside the order of the refund with consequential recovery. Two separate powers have been conferred under Section 11A and Section 35E on different authorities. Under Section 11 A, the Assistant Collector can issue a demand within the period of 6 months from the relevant date as set out under Section 11A, and under Section 35E the authorities have been conferred with the power to take care of an order which the learned supervisory authority has not felt proper or legal. The recovery of erroneous refund ordered by the lower authority would be one such contingency and the appellants are entitled to is that they should be put on notice before a decision is taken and this notice could be within a period as prescribed under Section 35E. In the present case we observe this notice, as it is, were issued within 6 months of the payment of the refund and under Section 35E, the appellants had been put on notice in regard to the recovery and the Tribunal has held that no separate notices under Section 11A would be called for as Section 35E confers separate power on the supervisory authority to pass orders in exercise of the Supervisory jurisdiction. We therefore find no question of law arises for reference. The Reference Application is therefore dismissed.