ORDER
R. Jayaraman, Member (T)
1. This is an appeal directed against the order of the Collector (Appeals) bearing No, V-2(2802) 1 468/88 dated 17.5.1989 rejecting the appeal of the appellants and upholding the order of the Assistant Collector dated 23.2.1988.
2. The brief facts necessary for the purpose of disposal of the appeal can be stated as below:
The appellants are the manufacturers of sulphuric acid. They had filed a refund claim for Rs. 81,122.78 to the Assistant Collector on the ground that the aforesaid amount representated basic central excise duty paid by them during the month of April 1986 on sulphuric acid manufactured and, used by them within the factory of production for manufacture of final product viz. sodium sulphate. Since the sulphuric acid is exempted, if it is captively used in the manufacture of sodium sulphate as per the Notification No. 217/86-CE dated 2.4.1986, the refund claim has arisen. The Assistant Collector held that the refund claim has been filed on 28.1.1987 in respect of payment of duty in the month of April, 1986 and hence it is beyond a period of six months as laid down under Section 11B of the Central Excises and Salt Act, 1944. Hence, he rejected the claim as time barred. Against the said order, the appellants went in appeal before the Collector (Appeals) who also rejected the appellants’ appeal. The present appeal is against the order of the authorities below.
3. Shri Lodha, the learned advocate, on behalf of the appellants contended that from 1.3.1986, they were paying duty on sulphuric acid used in the manufacture of sodium sulphate and were availing of Modvat credit From 2.4.1986 by way of exemption Notification No. 217/86 dated 2.4.1986, sulphuric acid became eligible for exemption, if it is captively used in the manufacture of sodium sulphate. They, therefore, filed a revised classification list claiming the benefit of exemption Notification 217/86 dated 2 4.1986 and since the classification list was not approved duty, was continued to be paid on sulphuric acid and Modvat credit of the same was taken and utilised against the duty payable on sodium sulphate. This continued from 2.4.1986 to 3.10.1986. On 3.10.19M5, the classification list was approved effective from 2.4.1986 According to this approved classification list, RT-12 assessments for the months from May to October, 1986 were finalised giving the credit of duty paid on sulphuric acid in the PLA account by the Supdt. and correspondingly ordering the debit of the Modvat credit taken in RG-23. In fact, they revised the Modvat credit taken on sulphuric acid including the month of April, 1986 on a clear understanding that the credit of excise duty paid on such sulphuric acid is restored to them in the PLA. On the same understanding, the Supdt. also has restored the credit of duty paid in respect of sulphuric acid in the PLA account for the months of May to October. 1986. They made the debit of the Modvat credit taken in respect of the sulphuric acid in RG-23 only on this understanding. Shri Lodha, took us through the letter dated 15.6.1987 and also the relevant endorsement of giving the credit of duty paid on sulphuric acid in the PLA. The RT-12 returns for the months of May, June, July, August, September and October, 1986 show that the department have given the credit of the duty paid on the sulphuric acid in terms of the approved classification list effective from 2.4.1985 without any objection. Shri Lodha also contended that the debit of the Modvat credit of duty paid on sulphuric acid during April, 1986 to October 1986 was done only after the assessment of RT-12 on sodium sulphate for the months of May, 1986 to October 1986, whereunder the credit of duty paid on sulphuric acid was restored in the PLA and accordingly they debited the Modvat credit in RG-23 account. The entire process is u question of transfer of credit and debit endorsement between PLA and Modvat account. Since the RT-12 returns for the month of April, 1986 was already assessed and the approval of the classification list was effective from 2.4.1986, they were required to file a claim for refund, which came to be rejected as time barred Shri Lodha, contended that their letter dated 15.6.1987 itself clearly shows that they are making the debit entries in RG-23 A Part 2 in respect of the credit taken towards the sulphuric acid only on the understanding that for the above period the benefit of Notification No. 217/87 (sic.) will be available from 2.4.1986. Otherwise, they would not have debited the Modvat credit taken in the month of April, 1986. He also cited the decision of the Tribunal reported in 1990 (26) ECR 398 (Cegat ERB) in the case of Balaji Fasteners v. Collector of Central Excise, Calcutta, wherein the Tribunal has held that refund of excess payment made by mistake is not covere by Section 11B Under Rule 1731 the Supdt. should have allowed credit of the amount due in the PLA while finalising the RT-12 returns when payment was made in excess under a mistake of law. He, therefore, stated that following the ratio of the aforesaid decision, in this case, the Supdt. has got the powers to restore the credit in the PLA in respect of the duty paid on sulphuric acid, which is otherwise exempted in terms of Notification No. 217/86.
4. Heard Shri Arya. He contended that in this case, RT-12 assessments for the month of April, 1986 has already been completed and hence the question of giving credit of duty paid in April, 1986 in the PLA by the Supdt. does not arise. Admittedly, the refund claim in respect of the duty paid on sulphuric acid during April, 1986 has been made only on 28.1.1987, which is beyond six months and the authorities have correctly rejected the refund claim as time barred. He also contended that the authorities functioning under the statute cannot condone the delay and they are to function within the time limit prescribed under the statute.
5. After hearing both sides, we find that in this case the issue to be decided is, whether in the facts and the circumstances of the case, the authorities below are justified in rejecting the claim for refund of excise duty paid on sulphuric acid. It is a settled law that any refund of excise duty is to be claimed within the period of limitation laid down under Section 11B of the Central Excises & Salt Act, 1944. Section 11B & Section 11A are self contained statutory provisions enshrined in the Act; one for refund of duty and another for recovery of duties not levied or not paid or short levied or short paid or erroneously refunded. The undisputed facts in this case are that notwithstanding the fact that sulphuric acid used in the manufacture of sodium sulphate was exempted by virtue of Notfn. No. 217/87 (sic.) applicable in respect of captively consumed inputs within the factory of production, the appellants had paid duty on sulphuric acid without any protest. Though they had filed the classification list claiming the nil rate of assessment in terms of the aforesaid notification, it was not approved till 3.10.1986. The classification list was approved with effect from 2.4.1986. On the basis of this approval, the RT-12 Return, which were pending assessments were finalised by giving credit in the PLA by the Supdt. in respect of the duty paid on sulphuric acid. The appellants also debited the RG-23 A Part-2 account corresponding to the Modvat Credit availed of in respect of sulphuric acid. This is evident from their letter dated 15.6.1987. It is also seen from their letter that they have debited the Modvat credit of duty paid on sulphuric acid even during April, 1986 and they have requested for allowing the benefit of Exemption Notification No. 217/87 (sic.) while assessing RT-12 returns on sulphuric acid. Since RT-12 for the month of April, 1986 has already been assessed, the question of giving credit in the PLA does not arise and cannot arise. Credit in the PL A can be given only in the RT-12 returns for the months from May to October, 1986 where the assessments were still pending Hence, in respect of the payment of duty for the month of April, 1986, the proper course is only by way of claiming of refund, which came to be filed only on 28.1. 1987, which is beyond the period of six months as laid down under Section 11B. We are unable to agree with the view urged by the learned advocate that the time limit prescribed under Section 11B can be computed only from the date of approval of the classification list and also the assessment done on RT-12 returns. Nor can we agree that till the approval of the classification list, assessment can be construed as provisional. There are specific statutory provisions laid down in the Rules for resorting to provisional assessment and admittedly such a course has not been resorted to in this case. It is a settled law that Section 11B is a self contained provision for claiming refund of duty paid (if the assessee feels that be is entitled to refund of duty, he need not have to wait for the approval of the classification list. Section 11B independently provides for the remedy by way of filing the claim within the time limit prescribed. In this context, it is pertinent to refer the judgment of the Calcutta High Court in the case of ITC. Limited and Anr. v. Union of India and Ors. wherein the Calcutta High Court have dismissed the contention of the Tribunal holding that for claiming refund, revised price list should have been approved.
6. The scope of Section 11A & Section 11B are wholly independent and they are not linked up with the approval of the classification or price list. Where the department feels that there is a short levy, Section 11A can be applied independently. likewise, where an assessee feels that they have paid excess duty, they can claim refund under Section 11B independently. In this view of the matter, we are unable to appreciate the plea made by Shri Lodha and also the decision of the Tribunal relied upon by him. We also observe that in that decision of the Tribunal reported in 1990 (26) ECR 398 (Cegat), the assessment on RT-12 return was pending, where the assessee sought for credit in the PL A, whereas in this case the assessment for April, 1986 has already been done. While making payment of duty on RT-12 for April, they have not claimed credit of duty before the Supdt. and there was no letter of protest even with regard to that payment. Hence, when this duty paid in April was sought to be claimed by their refund claim dated 28.1.1987, it has neither been paid under protest nor it was in pursuance of provisional assessment done under Rule 9(B).
7. We also observe that Section 11B itself clearly indicates what is meant by provisional assessment for purposes of fixing the relevant date. Clause (d) under (B) relevant date of Section 11B reads as follows:
In a case where duty of excise is paid provisionally under this Act or the Rules made thereunder, the date of adjustment of duty, after the final adjustment thereof.
(emphasis supplied).
Hence for construing provisional assessment for this purpose, it has to be one made under the Act or the Rules. There is a specific provision in Rule 9B providing for provisional assessment which also finds mention specifically in (i) Rule 173(B)-relating to classification list and (ii) Rule 173(C) relating to price list. In view of this, if an assessment is to be construed provisional in terms, of the Act or the Rules made thereunder, it has to be under Rule 9B of the Central Excise Rules and cannot be otherwise. Admittedly, in this past), such a course as envisaged in the law has not been adopted. We, therefore, are left with no other option but to hold the claim for refund of duty as time barred.
8. However, we find that in this case, as rightly pointed out by Shri Lodha, they have debited the Modvat credit for the month of April. 1986 by showing debit to the extent of Rs. 1,15,138.19. The Modvat credit debited to this extent would call for restoration, if the same could be done within the purview of the Modvat scheme at laid down under the Central Excise Rules. The appellants are at liberty to pursue this remedy open to them. With these observations, we reject the present appeal filed by the appellants.