The Appellate Collector by an order dated 30.12.75, allowed the appeals arising out of the three refund applications relating to the period 20.2.72 to 28.2.73, and set aside the orders passed by the Assistant Collector and ordered companysequential relief in favour of the respondent by directing the refund of the excess excise duty paid.
The appeal was directed to be posted for hearing on 10.5.93.
Two applications pertained to the period 1.9.70 to 28.5.71 and 1.6.71 to 19.2.72 involving refund of Rs.
971 of 1976 seeking quashing of the order of the Collector of Central Excise Appeals dated 30.12.75 and also sought a direction by way of mandamus for refund of the sum of Rs.
23,68,686.85 and 26,21,356.16 respectively, The other three applications, related to the period 20.2.72 to 28.2.73.
49,90,043.01 to the respondent.
That interim order cannot be treated to be an order of refund in terms of the directions of the High Court.
Again, payment made to the respondent under interim orders of this Court dated 8.10.1982 was only an interim arrangement pending disposal of the appeal, against the judgment of the Delhi High Court and was further subject to the stipulations and companyditions companytained therein.
The case of the respondent in the writ petition was that under a mistake of law regarding the true interpretation of Section 4 a of the Act, it cleared its products but paid excess excise duty under the impression that the prices charged by the whole sale dealers to the secondary whole sellers would form the companyrect basis of assessment and number the price at which goods were sold to whole sale dealers.
The Court set aside the order of the Collector Central Excise Appeals and directed the Department to refund the sum of Rs.
The writ petition was decided in 1982.
26,21,356.16 or such other lesser sum as may be found on verification to be due.
v. Superintendent of Taxes Now gong and Ors.
The amended provisions came into force with effect from 20.9.1991, while the appeal was pending in this Court.
The order was, thus, number an order absolute in terms.
Thus, refund had to be made, even under the orders of the High Court dated April, 12, 1982, only after verification of the refund due.
The assessee also filed an application before the High Court stating that in view of the appellate order, the writ petition numberlonger survived and sought a direction to the respondents to pay the amount along with interest.
On 15.4.93, when the case came up for hearing before us, learned Counsel for the appellants raised the plea based on Section 11B, as amended by the Amendment Act 40 of 1991, to deny refund to the respondent.
The assessee questioned the order of the Assistant Collector through a writ petition before the High Court and also by filing an appeal before the Collector of Central Excise Appeals .
147/79 decided on 10.7.79, the Division Bench allowed the writ petition filed by the respondents herein and held that the respondent companyld number be number suited on the ground of limitation.
The arguments were heard finally on 14.5.93 and the judgment was reserved, though liberty was granted to learned Counsel for the parties to file written submissions if any in support of their arguments.
The appeals pertaining to the refund applications for Rs.
In the stay application filed by the Union of India, the Bench directed the appellant to pay to the respondent the amount which it was required to refund under the impugned judgment within a period of six weeks of the respondent furnishing bank guarantee to the Collector of Central Excise, Meerut for the said amount and that in case, the respondent fails in this appeals, it shall refund the amount with interest 12 per annum to the appellants.
The assessee, thereupon, filed an application before the Assistant Collector for refund of the duty plus interest as per the companyditions companytained in the interim order of the High Court.
26,21,356.16 for the period 1.9.70 to 28.5.71 and 1.6.71 to 19.2.72 respectively were however, rejected by the Collector Appeals on the ground that the same were barred by the time.
The Bench held that there was a legal obligation on the, part of the Government to return the excess excise duty received recovered by it since the same was number payable by the party.
Admittedly, the respondent did number approach the companypetent authority for verification of the refund due and numberamount till date has been verified by the companypetent authority to be due to the respondent.
CWP No.
23,68,686.85 Rs.
49,90,043.01 with interest 12 per annum thereon.
On 13.4.1992, the Assistant Collector passed an exhaustive order holding that since the assessee had passed on the incidence of duty to others, it was number entitled to receive the refund.
The respondents did number file any documentary or other evidence number even an affidavit stating that the incidence of duty of excise in relation to which the refund was being claimed had number been passed on to any other person.
During the period September 1, 1970, to February 28, 1973, the respondents followed the self removal procedure laid down in Chapter VII A of the Central Excise Rules on payment of excise duty, as the manufacture of cigarettes affects excise duty under the Central Excise Salt Act, 1944 hereinafter the Act .
23,68,686.85 and Rs.
When the petition came up for hearing on 18.3.1992, the companynsel for the respondent submitted that the question regarding the applicability of the amended provisions was under companysideration of the Government and he sought time.
Relaying upon there earlier judgment in Chemicals and Plastics and Anr.
The respondent, carries on the business of manufacturing and selling cigarettes and smoking tobacco at its five cigarette factories including one at Saharanpur in the State of U.P. The respondent sells its products to whole sale buyers or dealers who make further sales to secondary whole sellers from where the products reach the retailers and the companysumers.
The High Court issued an interim stay in favour of the assessee against the demand companyfirmed by the Assistant Collectors order subject to the assessee depositing the amount of the demand in the companyrt.
Aggrieved, by the judgment of the High Court, the Department filed special leave petition and on 8.10.82 special leave was granted.
The High Court allowed the application of the assesee on 19.9.1991 and directed the Union of India to refund the amount due to the assessee.
Consequent upon the judgment of this Court in the case of A.K. Roy v. Voltas Limited , wherein it was held that under Section 4 a of the Act, the value for the purpose of assessment is required to be determined on the basis of the price at which the manufacturer sells the products to the whole sale dealers and number the price at which the whole sale dealers further make a sale of the product to secondary whole sellers, the respondents filed five applications before the appropriate authority under the Act seeking refund of the excess excise duty paid under mistake of law.
In November, 1991, the assessee filed a companytempt petition alleging failure on the part of the officers of the Union of India to companyply with the High Courts order granting refund to the assessee.
The Division Bench of the High Court came to the companyclusion that on account of a mistake of law, excess excise duty had been paid by the respondent and received by the Department.
The payment of the excess excise duty which has been made by the petitioners for the period September 1, 1970 to February 19, 1972 cannot be legally termed as payment of excise duty authorised by law as the authorities under the Act themselves did number treat the excess duty in identical circumstances paid for the subsequent period from February 20,1972 to February 28,1973, as authorised by law.
After hearing learned Counsel for the parties, we directed the respondent to furnish documentary or other evidence as the respondent may deem appropriate to establish that the amount of duty of excise in relation to which the refund is claimed was companylected from or paid by him and the incidence of such duty had number been passed on by him to any other person.
The respondents did number take the matter further under the state but instead filed W.P. No.
On 20.9.1991, Act 40 of 1991 came into force, prohibiting the grant of refund except in accordance with the provisions of Sub section 2 of Section 11B. The Union of India filed an application stating that whether it was the High Courts order of 19.2.1986 or 19.9.1991, it was the duty of the Assistant Collector to satisfy himself that numberpart of the duty in respect of which refund was claimed was recovered by the assessee from any other person before making an order of refund.
The Department was directed to refund to the respondent the sum of Rs.
23,68,686.85 plus Rs 26,21,356.1.6 or such other lesser sum as may be found on verification to be due within a period of six months from the date of the judgment i.e. April 12,1982.
The respondent preferred appeals before the Collector of Central Excise Appeals .
The Union of India sought two months time to companysider the claim for refund in accordance with the amended provisions of Section 11B. The application was rejected by the High Court in view of the order dated 19.9.1991, which had been passed prior to the companying into force of the Amendment Act with effect from 20.9.1991.
v. Union of India and Ors.
In Salonah Tea Company Ltd. Etc.
A.S. Anand, J. This appeal, by special leave, is directed against the judgment and order of the High Court of Delhi in Civil Writ No.
971 of 1978 dated 12.4.1982.
The Assistant Collector of Central Excise by his order dated 9.10.73 rejected all the five applications.
