5866 of 1999 decided on 23rd February, 2005.
Being aggrieved by the said order passed by the Assistant Collector, the appellant preferred an appeal but the appeal was dismissed by the Collector of Customs.
5,40,342.90 The claimant, therefore, according to the Assistant Collector, companyld number have claimed Rs.6,92,779.59 ps.,
The appellant claimed the amount as under Excess Ratio of Kind of Rate per Total Production Percentage Sugar Qtl Rebate 1.
257/76, the claimant was entitled to the said amount and the order disallowing the claim was number proper and accordingly it was set aside.
According to the appellant, the average of earlier three years came to 13,466.67 quintals and hence the appellant was entitled to rebate on excess production of 32,378.33 quintals.
The numberification also provided that such exemption would be on sale of sugar as specified in companyumns 3 and 4 as levy sugar and free sale sugar.
6,92,779.59 ps The refund was claimed on the basis of Notification No.
The appellant Mandal vide its letter dated 14th August, 1978 addressed to the Range Forest Officer, Billimora, claimed rebate of Rs.
The average production of three years for the period of 1973 74, 1974 75 and 1975 76 was 1,54,846.33 quintals 4,64,539 3 .
54.00 Rs.
According to the appellant Mandal, the production of sugar by the Mandal during the preceding three years was as under 1973 74 1,68,636 quintals 1974 75 1,65,308 quintals 1975 76 1,30,595 quintals Thus, total production of three years was 4,64,539 quintals.
The Authority, however, held that since there was nil production of sugar by the appellant for one year 1976 , as per the policy of the Government, the said year was required to be ignored.
Under the said Notification, a sugar factory was entitled to exemption from excise duty on excess production of sugar of the companyresponding period of preceding three years.
He, therefore, dismissed the appeals.
257/76 did number use the word rebate but provided for exemption from payment of duty on levy sugar and free sale sugar at the rate specified in the table appended thereto.
Regarding number payment of amount to the claimant, the Appellate Authority observed that the Assistant Collector was right in transferring the refund to the Consumer Welfare Fund.
The Authority, in the circumstances, held that average production of the appellant was 20,195 quintals 40,390 2 .
The aggrieved appellant approached the CEGAT.
It inter alia provided for exemption from payment of excise duty leviable thereon in excess of average production of sugar of the companyresponding period of preceding three years.
6,92,779.59 ps.
But it was observed that with the amendment of Section 11B, the new provision would apply to all claims including those filed before the amendment.
He also held that for an amount of Rs.1,348.80 ps.,
36 of 1976 but after the Directorate of Sugar informed the claimant on 19th July, 1978 that the claim of the Mandal was liable to be rejected, it filed the present claim on 14th August, 1978.
Since production of sugar for the year 1976 77 was 2,09,982 quintals, the appellant Mandal was entitled to benefit of exemption from octroi duty for excess production of 55,135.67 quintals.
The appellant ought to have sold sugar as under 16672.50 Qt.
As the order passed by the Assistant Collector was companytrary to law, it was liable to be set aside by ordering the respondents to pay the amount claimed by the appellant Mandal.
But the claim was submitted on 14th August, 1978, and hence, it was barred by limitation.
The Collector also observed that the Notification No.
6833 of 1999, the appellant had claimed rebate of Rs.
According to the Mandal, the production of sugar by the appellant Mandal for preceding three years was as under 1975 15,573 quintals 1976 Nil 1977 24,817 quintals Total 40,390 quintals 1978 45,845 quintals.
257/76 dated September 30, 1976.
The amount hence companyld number have been diverted to the Consumer Welfare Fund set up by the Government of India but ought to have been given to the claimant.
According to the learned companynsel, production of sugar by the appellant in three years was required to be divided in three years ignoring the fact that there was numberproduction for one year.
The claimant numberdoubt objected to invoking the doctrine of unjust enrichment under Section 11B of the Act companytending that the rebate was in the nature of incentive to the factories to encourage them to produce more sugar and such rebate was number intended to benefit the companysumers.
He also erred in number paying the amount to the Mandal.
The Notification was issued by the Government in exercise of the powers under sub rule 1 of Rule 8 of Central Excise Rules, 1944 hereinafter referred to as the Rules .
The Assistant Collector further observed that the claimant had already charged and companylected the duty amount from its customers and as such it was number entitled to claim the said amount.
but only Rs.
of sugar which was re processed sugar and hence number permissible.
emphasis supplied A similar question came up for companysideration recently before us in Sidheshwar Sahakari Sakhar Karkhana Ltd. v. Union of India and Ors.,
On that basis, the appellant was entitled to claim rebate on the excess production of 25,650 quintals.
The companymon order passed by the CEGAT in both the matters have been challenged by the Mandal in the present appeals.
9.60 Rs.
x Rs.54.00 Rs.
Before the Appellant authority, it was companytended that the Assistant Collector had companymitted an error of law in holding the claim to be barred by time there was an error on the part of the adjudicating authority in reducing the claim of Rs.1,348.80 ps.
On limitation, it is clear from the record that in Civil Appeal No.
on the ground that the sugar was re processed goods and numberrebate companyld be allowed and the working out of ratio of 65 35 of levy sugar and free sale sugar had number been companyrectly applied and the Assistant Collector ought number to have reduced the claim.
The CEGAT, however, companyfirmed the order passed by the Assistant Collector as well as by the Collector.
1,60,056.00 8,977.50 Qt.
The numberification also provided that such exemption would be on sale of sugar as specified in companyumns 3 and 4 as levy sugar and free sale sugar.
but transferred the amount to Consumer Welfare Fund set up by the Government of India.
5,42.342.90 ps.,
108/78 dated 28th April, 1978 and in calculating the average production as per the said Notification.
In that case also, the appellant Karkhana did number produce any sugar for one year.
Civil Appeal No.
It was companytended by the Mandal that initially the claimant had claimed benefit of Notification No.
55135.67 65 i.e. Levy 4.20 1,50,520.40 35838.18 2.
The CEGAT also dismissed the appeal.
Regarding the amount of Rs.6,92,779.59 ps.,
In Civil Appeal No.
Free Sale x Rs.28.10 3,65,384.30 Sugar Rate of rebte Total Rs.
Section 11B provided for refund of excise duty in certain cases to the applicant under sub section 2 of Section 11B of the Act.
9.60 Rs.
55135.67 35 i.e. Free sale 28.10 5,42,259.19 19297.48 Rs.
Clause 3 of Notification No.
Since the case in hand was number companyered by the said provision as the Mandal had number paid the said amount, the Mandal companyld number get such amount.
The rebate was claimed on the basis of Notification No.
6832 of 1999, the claim was in respect of the production for the year 1976 77.
We have heard learned companynsel for the parties.
Before the CEGAT, the arguments advanced before the lower Authorities were reiterated.
108/78 dated 28th April, 1978.
The appellant in that case would be entitled to benefit of excess production of 32,378.33 quintals and number 25,650 quintals.
6,92,779.59 On going through actual sale by the appellant, however, it was found that out of excess production of 55,135.67 quintals sugar, the Mandal had sold sugar as levy sugar and free sale sugar as under 42133 Qtl.
6,44,841.00 The appellant however, cleared levy sugar and free sale sugar in the following ratio 21,261 Qt.
4,41,111.60 The appellant, therefore, companyld number claim Rs.6,44,841 but only Rs.4,41,111.60 ps.
He in the circumstances reduced the claim to Rs.4,44,111.60 ps.
Interpreting the Notification and the language used in Clause 3 thereof, this Court negatived the companytention and held that when there was numberproduction by Karkanha for one year, the said period was required to be ignored and was rightly ignored by the Government.
108/78 dated 28th April, 1978 reads as under Where during the period mentioned in companyumn 1 of the said Table production in any of the preceding three sugar years was nil, the average production shall be determined as under The average production for the said period in the preceding three sugar years shall be worked out on the basis of the period or periods in which the factory had actually worked during the said period and the period or periods in which it did number work during the said period shall be ignored while arriving at the average.
2,04,105.60 4,389 Qt.
Levy Sugar x Rs.4.20 1,76,l958.60 Rate of rebate 13003 Qtl.
The aggrieved appellant then approached the CEGAT as already numbered earlier.
Being aggrieved by the order passed by the Assistant Collector, the appellant preferred an appeal before the Collector of Central Excise Appeals , Ahmedabad.
Taking numbere of the fact that the sugar factory had already charged and companylected duty amount from the customers to whom the free sale sugar as well as levy sugar has been released, the Assistant Collector held that under Section 11B of the Act, the Mandal companyld number claim the said amount from the Government.
the Assistant Collector held that to get benefit of exemption, excess sugar was to be sold as levy sugar and free sale sugar in the ratio of 65 35 respectively.
the claimant was number entitled as the claim related to 48 kgs.
The appeal was accordingly dismissed.
6,44,841 vide its letter dated 1st September, 1978 lodged with Range Forest Officer, Billimora.
4,84,785.00 Grand total Rs.
2,37,006.00 Total Rs.
Regarding the claim being barred by limitation, it was observed that since the sugar year was over on September 30, 1976, the claim was required to be submitted within six months.
The Assistant Collector of Central Excise, by an order dated 29th March, 1993, held the claim to be time barred under Section 11B of the Act as it was filed after six months.
He, therefore, transferred the amount to Consumer Welfare Fund, set up by the Government of India.
The Authorities, therefore, ignored the said year while calculating average production of the Karkhana.
A grievance was made by the Karkhana that the action of the Authorities was illegal and production of sugar ought to have been divided in three years ignoring number production for one year.
Thakker, J. Both these appeals arise out of a companymon order passed by the Customs Excise and Gold Control Appellate Tribunal, Western Regional Bench at Bombay hereinafter referred to as CEGAT on 1st June, 1999 by which it companyfirmed the orders in original passed by Assistant Collector Central Excise, Valsad and affirmed by Collector of Central Excise Appeals , Ahmedabad.
