HIGH COURT OFCHHATnSGWlH AT BILASPUR TaxCaseNo.13 of 2009 APPELLANT: Union Of India, Through Commissioner, Cefrtral Excise and Customs, Central Exclse Bhawai, Dhamtari Road, Tikarapara, Raipur (CG) 492 001 Versus RESPONDENT: M/s Swastic Industries, 596, Uria industrial Compiex, Raipur (CG) Present: Shri Bhishma Kinger, counselforthe appellant. DjyjsjoiLBench: Hon'bte Shri Dhirendra Mishra& Hon'ble Shri R.N. Chandrakar. JA JUDGMENT (10-3-2010) 1. This appeal under Section 35-G of the Central Exdse Act, 1944 (for short the Act') is directed against the impugned judgment of the Customs, Excise & Servlce Tax Appellate Tribunal, Kolkata (for short 'the Tribunal') and the appeltant/Revenue has preferred this appeat on the foltcwing sub^antial questions of law:- • 'Whether the leamed CESTAT was eorrect In setting aside the order of Commissioner (Appeals)and allowing the appeal of the party wlth consequential relief, on the ground that the refund was not barred by limitatlon under Section 11B of the Central Excise Act, 1944, even when the amount was paid voluntarily bythe party during the course of investigErtion and b«fore issuance of show cause notice and adjudication ofthe ease? • Whether the learned CESTAT was correct in relying upon the judgment of the Supreme Court in the case of Dena Snuff(P) Ltd. Vs. Commissioner, [2003 (157) ELT '&^, 500 (SC)] when the facts and cireumstances in the saU case was differerrt and distinguishable from the instant case, since in the csise of Dena Snuff (P) Ltd., the party had paid duty under protest and in the instant case the party had paid duty voluntarily? • Whether the learned CESTAT had acted in accondance with law In settlngaslde the order of the appellate authority without arriving at a findfng that the said order was in any way, in breach of law, Rutes or regulations or inany other way illegal? ' 2. Briefly stated facts of the case, as projected in the memo of appeat, are that the respondent is engaged in manufacture of HDPE pipes and fittings and they are availing the benefrt of Modvat/Caivat scheme. A search was conducted in the factory premises of the respondent on 11-1-96 by the officers ofthe DGAE, Kolkata and the Central Exctee, Ralpur and on gh)reical veriflcation, certaln quantities of HDPE Pipes; HDPE wastage of tape and fresh HDPE granules were found short; Besides above, certain quantities of regenerated/recyoled HDPE granules were also found in excess and unaccountsd and the ^me wereseized. 3, After the search and seizure, the respondent deposited a sum of Rs.2,50,000/- and Rs.3,86,113/- through two cheques dated 25-3-1996 and 3-9-96 respectively towards the duty liability. After serving separate show cause noticps, the Commissfoner, Central Excise Raipur confirmed the demand duty of Rs.1,79,549/- and Rs.5,39,27»- in respect of finished goods and inputs rrepectlvely fbund strort. He prdered conflscation of recycled HDPE granules found in excess and imposed a redemption fine of Rs.80,000/- in tieu of confiscation. A ^^^^li^ '^ f • ^••"—^- '*"'?, penalty of Rs.50,000/- was also imposed against the party. The Commlssioner further ordered that the amajnt deposlted through two cheques be adjusted agatnst the coftfirmed demand. 4 On appeal by the respondent, the Tribunal vlda its final order dlated 13-2-2002 confirmed the order of Commisstoner wlth respeet to demand of Rs.1,79,549/-,however, the respondent's appeal in reapect of confirmation of demand and disallowance of Modvat credit of Rs.5,39,275/- and redemption fine of Rs.80,000/- in tieu of confiscation of recycled HDPE granules was altcwed and penalty of Rs.50,p00^- was reduced to Rs.25,000/-. After the above order of Ihe Tribunal,'the respondent moved an appliiation on 30-4-2002 which was received by the appellant on 24-5-2002 and prayed for refund of Rs.4,31,564/- in view ofthe flnal order dated 13-2-2002 ofthe Tribunal. The a^lication for refund was re-submitted on 26-6-2002 after the same was retumed by the appellant with certain dlrections. 5. The Assistant Commissioner (Adjudlcatlng Authorrty) rejected the refund claimed on the ground that the same was not flled within a period of 6 months from the date of payment of duty as per Sectton 11- . B of the Act. The Appellate Commissioner ftjrther dismissed the appeal of the respondent and conflrmed the order of the adjudicaBng authority and held that the claim was fited beyond the preseribed period of limitation and, therefore, not refundable being tlme barred. However, the Tribunal, relying upon thejudgment in the matter of Dena Snuff (P) Ltd. Vs. Commissioner of Central Excise, ChandlgartT {2003 (157) ELT 500{SC)}, by the impugned'order allowed ttie appealand held that cause of claiming refund arisesorty when the dispute regarding Modvat credit was flnally decided bythis Tribunal and ttie period of limitatlon would start to run from the date of finat deciston or order. 6 Learned counsel for the appetlant submitted ttrat the respondent voluntarily deposited custom duty without any protest aftsr the seareh was effected in his premises and certain irregularittes were faind on verification of stock. Section 11-B of the Act, as applicable during the reievant period, required the filing of refund claim within 6 months from the date of payment and thus the adjudicating authority and the Appellate Commissioner were justifted in holding the applioatlon as time barred. The judgment in the matter of Dena Snyff (P) Ltd. (Supra) was not applicable to the facts of the present case, as in the clted case, the duty was paid by the assessee under protest. 7. We have heard leamed counsel forthe appetent. s tndisputably, in the instant case, after the search WBS conducted and certein irregutarities were noticed during search, the re^ondent deposited the amount towards excise duty through two cheques, however, the adjudicating authority, after seeldng reply from the respondent, imposed excise duty in respeet of flnished goods and inputs respecth/ely found short and he further directed to adjust the amount deposited by the respondent through cheques towards the aforesaid liability. The respondent's appeal was further dismissed by the Appellate Commissioner, however, the appeal preferred by tfte respondent was partly allowed and the order of the adjudicating offteer which was subsequently confirmed by the Appellate CommiBsionw ^" fC. II ^ ^ ''^ was modified and only thereafter the respondent filed an application for refund under Section 11 -B of the Act. 9. Inthe matter of Collector of C.E., Chandigarh Vs. Doaba Co. operative Sugar Mills {1988 (37) E.L.T. 478 (S.C.)}, Vthas been held that where the duty has been tevied without the authority of lawor without reference to any statutory authority or the speeific provisions of the Act and the Rules framed thereunder have no application, the decision will be gulded by the general law and the date of limitation would be the starting point when the mistake or the error comes to light. But in makfng claims for refund before the departmental suthority, an assessee is bound within four comers of the Statute and the period of limitation prescribed in the Central Excise Act and e Rules framed thereunder must be adhered to. The authorities TuncAionjng undter ttie Act are bound by the provisions of the Act. If the proceertngs are taken under the Act by the department, the provisions of liffiitatian prescribed in the Act witl prevail. 10. However, in the instant case, duty was pald by the respondent after certain irregularities were found during seareh and seizure even before •issuance of any notice from the appetlant. A show eause notioe was issued thereafter to the respondent and liability was fixed on the basis of finding in seareh operatlon. The amount depostted by the respondent was adjusted towards the liability so fixed, however, the dispute regarding Modvat credit was finally decided by the Tilbund and only thereafter within a period of llmitation prescribed under the Act application fpr refund was filed. It is not a casewhere a duty has been tevied/depositedwithoutthe authority oflaw orwithout referenceto any I, 9 %s& '^•.^^-•:ss statutory provision on account of some mistake. Admittadly, the respondent deposited the duty towards his liability whtch was finally decided bythe Tribunal on 13-2-2002and, therefore, in our considered opinion, the argument of leamed counsel for the appellant that perjod of limitation woidd commence fronn the date of deposit cannot be accepted and the decision of the Tribunal in the impugned order is in accordance with law. 11.0n the basls of aforesaid discussion, we are of the opinlon that no substantial questions of law as proposed by the appellant fpr adjudication pfthe aforesaid appeal arises. 12. In the result, the appeat is liable to be dismissed and is accordingty • dlsmissed. Barve Sd/- Dhu-endra Mishra Judge Sd/- R.N. Chandrakar Judge