JUDGMENT
Dharmadhikari J.
1. This petition is filed by the Petitioner-Company against the order passed by the Assistant Collector of Central Excise, Pune Division, Pune dated 27th of March, 1981 refusing to refund the claim, on the ground that the claim made was beyond the period of limitation prescribed by Rule 11 of the Rules.
2. It appears from record that the refund claim was made by the petitioner-company for a period from 4th May, 1977 to 3rd of May, 1980, on the ground that there was an apparent mistake in classification of goods. It is not necessary to consider the various contentions raised before us in that behalf, in view of the decision of this Court in 1987 Mah. L. J. 900-R. Parthasarathy Assistant Collector, Central Excise, Kalyan Dn. and Anr. v. Dipsi Chemicals Private Limited & another. After making detailed reference to the various decisions in the field this is what the Division Bench has observed in paras 17 and 18 of the said judgments:
17. It has also been brought to our notice by Mr. Taraporwalla, appearing for the respondents, that another Division Bench of this Court (Bharucha and Tipnis JJ) have rejected again the doctrine of unjust enrichment in S.S. Miranda Limited v. Union of India and Anr. (Appeal No. 401 of 1985 in Writ Petition No. 1179 of 1980, decided on 27th of August, 1987) : [1988 (14) ECR 166 Bombay]. In this judgment, the learned Judges referred to the judgment of the Division Bench of this Court in the case of Rapidur (India) Limited : [1987 (11) ECR 336 Bombay]. The total effect is, therefore, as far as this Court is concerned, or at any rate as far as the Division Bench is concerned, the doctrine of unjust enrichment is buried ten fathoms deep.
18. It may not be out of place to briefly mention the underlying principle of which the Courts grant relief to the person from whom taxes have been recovered by the State without the authority of law. The State cannot levy any tax without the authority of law. When, however, the State or the departments of the State make a demand upon a manufacturer asking the latter to pay excise duty on a particular product and at a particular rate, the latter has two options. If he does not agree with the demand, he can challenge the same by adopting appropriate proceedings. If, however, he has no dispute in the light of the law understood by him about the nature and extent of the demand made on him, he complies with the demand. If it is later discovered that there was a mistake of law in the demand and the payment of the duty, then naturally be is entitled to ask the person who has collected the duty without the authority of law to refund the same. In such a case, one cannot see how the person or the authority which has collected duty without the authority of law can contend that the amount will not be refunded to the person from whom the same is collected. It is not as if that the person who has collected from his customers and paid it to the State has done so willingly. He has paid the amount of excise duty to the State because he is under a compulsion to do so. If he refuses, penal consequences would follow. It is, therefore, unintelligible as to how the State can contend that though it has collected the duty illegally or without the authority of law, it will not refund the same to the person, from whom it has collected and who has paid under the compulsion of law, on the ground that the amount, if refunded, will be retained by that person.
This judgment is binding on us, and the judicial discipline mandates that a coordinate bench should follow it. However, it was contended by Shri Sethna that in view of the provisions of a Rule 11, the claim for refund made was barred by limitation. It is also contended by him that the mistake made by the petitioners-Company was a mistake of fact and not of law and, therefore, to such a case the period of limitation prescribed by Rule 11 will squarely apply. In support of this contention he has placed reliance upon the decision of the Supreme Court in , M/s. Madras Rubber Factory Limited v. The Union of India & others -Godavari Plywoods Limited v. Union of India & others, 1983 ELT 1783-Union of India v. New India Industries Limited Baroda (l983 ECR 2002 D) and 1984 (17) ELT 246- Union of India & others v. Ahmedabad Manufacturing and Calico Printing Company Limited and Ors. It is not possible for us to accept these contentions of Shri Sethna in view of the consistent view taken by this Court which is reflected in the aforesaid decision i.e. R. Parthasarathy’s case.
3. It is also not correct to say that the mistake committed was a mistake of fact and not mistake of law. In this context a reference could usefully be made to the finding of the Assistant Collector in para 6 of his order and this is what the Assistant Collector has held therein:
….It is not disputed that the classification of the product was through mistake and was also approved accordingly as per the assesse’s declaration and duty was paid under that tariff item during the relevant period. The assessee came to know about the mistake in classification and thereupon revised the classification list declaring the product as classifiable under Tariff Item 33B (ii). The revised classification list was approved after getting a test report from the Deputy Chief Chemist, Bombay. It is not therefore, disputed fact that there was a mistake of the assessee while getting approved the classification list in the earlier period…. .
Thus it is quite obvious that there was a mistake on both sides and the mistake was obviously relating to the classification itself which could safely be termed as a mistake of law. In this view of the matter, following consistent view taken by this Court, we have no other alternative but to direct the Respondents to refund to the petitioner-company the amount of Rupees 3,64,203.93 as claimed by it.
Hence Rule is made absolute with no orders as to costs.
Shri Mhamane has made a statement that he has advised his clients to use this refund amount towards the welfare activities. We are informed that the petitioner-company has no objection to do so, if the amount is not claimed by the consumers, or the dealers who have paid it. We do hope that the Company will use this amount towards the welfare activities as advised by the learned Counsel.