ORDER
G.P. Agarwal, Member (J)
1. Being dissatisfied with the rejection of their refund claim amounting to Rs. 96,682.95, the appellants have filed the present appeal.
2. Factual structure of the case is that the appellants M/s. Singhvi Woollen Industries manufactured woollen yarn from indigenous virgin wool falling under Central Excise Tariff Item No. 18-B during the period 30-8-1976 to 15-6-1977 and paid duty @ 10%. However, the appellants preferred their refund claim for Rs. 1,06,078.95 on 4-8-1980 on the grounds that woollen carpet processed yarn manufactured and cleared by them was charged to Central Excise duty @ 10% Ad valorem on Tariff value of Rs. 37.50, whereas their product was assessable on Tariff value of Rs. 30/- in view of Notification No. 235/76 dated 30-8-1976, as the manufacture scoured yarn which was obtained by manmial process of washing the noncoused yarn to free the yarn from greasy element and the said yarn was chargeable to duty at the rate of Rs. 30/- per kg., and further that the duty paid by them was under protest in view of their letter dated 11-10-1976. It appears that on examination of the said refund claim it was noticed that the appellants had submitted their classification list from 30-8-1976 in view of Notification No. 235/76 dated 30-8-1976 wherein they themselves had mentioned their product as “Processed yarn” having Tariff description as 186(2) and rate of duty as 10% Ad valorem on Tariff value of Rs. 37.50. This classification list was not submitted under protest and was approved by the Assistant Collector vide Sri. No. 39/77 dated 1-3-1977. As a sequel thereof a show cause notice calling upon the appellants to show cause as to why their refund claim be not rejected was issued. The appellants contested the show cause notice, but the Assistant Collector vide his Order-in-Original dated 19-8-1981 rejected the said refund claim. But on appeal the case was remanded by the Collector (Appeals), New Delhi vide his Order-in-Appeal No. 91/JPR/83 dated 28-3-1983. On remand the Assistant Collector vide his Order-in-Original No. 1/84-CE., dated 24-1-1984 partly allowed the refund claim amounting to Rs. 96,682.95 paid in excess of Tariff value of Rs. 30/- per Kg from 17-10-1976 to 15-6-1977. Against that order the Assistant Collector of Central Excise, Ajmer filed the appeal before the Collector of Central Excise (Appeals), New Delhi, who allowed the appeal and set aside the order-in-original No. 1/84-CE passed by the Assistant Collector holding that the refund claim was time-barred. Hence the present appeal by the appellants.
3. shri Satyasheet, learned counsel for the appellants at the outset submitted that the refund claim of the appellants was allowed by the Assistant Collector vide his Order dated 24-1-1984 on merits and also on limitation in view of their protest letter dated 11-10-1976 and on appeal the Collector (Appeals) vide his impugned order set aside the order of the Assistant Collector granting the refund not on merits but on the point of limitation holding that the classification list filed by the respondent was approved by the Assistant Collector of Central Excise, Ajmer on 1-3-1977 and therefore, in view of this approval of the classification list protest letter dated 11-10-1976 lost its validity, this finding according to the learned counsel was erroneous in law. Elaborating on his submissions he submitted that receipt of the said protest letter dated 11-10-1976 and the failure of the Assistant Collector to take the said letter of protest into consideration while approving the said classification list on 1-3-1977 are not in dispute as could be seen from the order-in-original dated 24-1-1984, wherein the Assistant Collector had stated in unmistakable terms that “as per records the party submitted their letter dated 11-10-1976 containing their protest against the levy on higher Tariff value of Rs. 3750 per kg. stating that then- yarn is not processed yarn and they were stamping all the gate passes as ‘Duty paid under protest’ from 17-10-1976, but while approving the classification list their protest was not brought to the notice of approving authority”. In this premises he submitted that when admittedly the letter of protest dated 11-10-1976 was filed and received by the Assistant Collector much before the approval of the said classification list on 1-3-1977, the failure of the Assistant Collector to take the said letter of protest into consideration while approving the price list or the failure on the part of the authorities concerned to bring the said letter of protest to the notice of the approving authority at the time of considering the classification list for approval was of no consequence. In a nutshell his submission was that when the letter of protest was filed before the approval of the classification list and the duty infact paid under protest by stamping all the gate passes as “Duty paid under protest”, the time limit prescribed under erstwhile Rule 11 of the Central Excise Rules, 1944 was not applicable under the saving clause of the said Rule. To buttress his submission he cited the case of The Andhra Cement Co. Ltd. v. Collector of Central Excise, Guntur – 1986 (26) ELT 553 (Tri.) and Order No. 158/85-C dated 20-2-1985 passed by this Tribunal in the case of MA. Sree Radhakrishna Vegetable Oil Products Company, Kalluru v. Collector of Central Excise, Hyderabad. In the case of The Andhra Cement Co. Ltd. v. C.C.E., Guntur, supra, the classification list was filed for approval including the cost of packing charges and on the next day a letter was sent to the Excise Authorities for the exclusion of the packing charges on the assessable value, but the same was ignored and the price list was approved without any amendment and consequently a refund claim was lodged beyond the tune prescribed for filing the refund claim on the ground that the said letter of protest saves the limitation. However, the claim was rejected by the Assistant Collector and on appeal before this Tribunal it was held that the protest need not necessarily be lodged only after the approval of the price list. It may also be after the filing of the classification list but before the approval of the same and if the protest is filed prior to the approval of the price list the approving authority must deal with it and if it over-rules the protest, the reason(s) must be forthcoming. In the case of Sree Radhakrishna Vegetable Oil Products Company v. C.C.E., Hyderabad, supra the case was remanded with the observation that neither the Assistant Collector nor the Appellate Collector took the protest into account while holding the claim as time barred.
4. In reply Smt. Vijay Zutshi, learned SDK supported the impugned order while reiterating the reasonings and findings recorded by the Collector (Appeals) in his impugned order.
5. We have considered the submissions. By the impugned order the Collector (Appeals) had set aside the order of the Assistant Collector solely on the ground that the refund claim was barred by tune observing as follows –
“I have carefully considered the grounds of appeal and the submissions made by the respondents. I find that the classification list filed by the respondents was approved by the Assistant Collector Central Excise, Ajmer on 1-3-1977. In view of the approval, the classification became final and the protest letter dated 11-10-1976 lost its validity as the respondents did not prefer an appeal against the Assistant Collector’s order, or file a refund claim within the stipulated time limit. It is certainly not open to the assessee to reopen assessments of a later time after the expiry of legally fixed time limits. In this instant case the refund claim was preferred after a lapse of four years without any justification. The decision of the CEGAT cited by the respondents is not applicable as the facts or circumstances are obviously not similar. I, therefore, observe that the refund claim is time-barred.”
6. From the aforesaid observations of the Collector (Appeals) it is clear that he did not dispute the findings of the Assistant Collector recorded in his order-in-original dated 24-1-1984 that the said letter of protest was received before the approval of the classification list on 1-3-1977 and the same was not considered by the approving authority while approving the classification list being not brought to his notice. Thus, in the teeth of these admitted facts it is beyond our comprehension to understand as to how the said letter of protest dated 11-10-1976, which was admittedly filed before the approval of the classification list on 1-3-1977 lost its validity when in fact it was never reffered to by the approving authority while approving the classification list. If that is so, the question of applying the time limit of six months prescribed under erstwhile Rule 11, ibid does not arise and since the refund claim of the appellants was allowed by the Assistant Collector on merits and also on limitation and the Collector (Appeals) rejected the claim only as time barred, we following the ratio of the decision rendered by this Tribunal in the case of The Andhra Cement Co. Ltd. v. Collector of Central Excise, Guntur, supra allow the appeal and hold that the refund claim of the appellants was not time barred in view of the said letter of protest under the saving clause of the said erstwhile Rule 11.
7. In view of the above we allow the appeal, set aside the impugned order passed by the Collector (Appeals) and restore the order of the Assistant Collector with consequential relief.