1. The case was argued before us on 15-2-1983. In this case, the Appellate Collector allowed the appellant's claim for refund on account of set-off in terms of exemption notification No. 178/77-CE for the period after 30-6-1978 and rejected the claim in respect of the earlier period on the ground of time-bar under Rule 11 read with second proviso to Sub-rule (10) of Rule 173PP of the Central Excise Rules, 1944. The appellants stated that the time-bar was not applicable to their claim as they had made the claim for set-off in the very beginning in their classification list submitted to the Assistant Collector on 8-3-1978.
The Assistant Collector did not approve the classification list for well over a year and they, therefore, reminded the Assistant Collector on 23-4-1979. Ultimately, the Assistant Collector approved the classification list after striking off the entry relating to the appellant's claim for set-off. They stated that the Assistant Collector gave no reasons for deleting this entry in their classification list.
The appellants produced the relevant classification list in original before us to substantiate their statement. They relied on Delhi High Court judgment in 1981 ELT 496 to plead that their refund claim could not be rejected on the ground of time-bar since they had made a claim for it well in time in their classification list.
2. The Department's representative countered the appellant's argument saying that the claim made by the appellants in the classification list was not very specific as it did not give adequate data to work out the set-off nor did it quantify the amount of set-off. In view of their vague claim in the classification list, it was incumbent on the appellant's part to file a regular refund claim for a specific amount within the time-limit of six months and since the appellants had filed such a refund claim on 26-4-1979, they were entitled to get-off only for the period of six months preceding 26-4-1979, 3. We find that in the classification list dated 8-3-1978, the appellants made a claim for the set-off in the following terms : - appellants (2) -do-. Aluminium strips as per the quantity and value as per the copy enclosed as per Notice No. 178/77; dated 18-6-77." The Department's objection in considering the above entry as a claim for set-off on the ground that it did not quantify the amount of set-off has no force. The end-products involved in this case were (1) Power and Distibution Transformers 25 KVA TO 10, KVA, and (2) Oil Testing Set, each one almost custom built and requiring varying amounts of inputs, duty on which would be fluctuating from time to time depending upon the quantity as well as value of the inputs. In such a situation, it is not reasonable to expect that the appellants would be able to visualise the amount of set-off per unit of transformer etc. in advance. Even assuming that the Assistant Collector needed some more data which the appellants could reasonably give in advance, he should have asked the appellants to furnish that data rather than score the entry relating to the claim for set-off without assigning any reason.
We, therefore, agree with the appellants that because of their claim for set-off having been made well in time in the classification list, the Appellate Collector was not justified in rejecting it on the ground of time-bar.
4. However, during arguments in this case, a doubt arose in our mind as towhether the appellants were entitled to set-off at all in term, of noti-fication No. 178/77-CE. This notification grantsset-off in respect of the duty paid on inputs falling under Item 68 of the Central Excise Tariff. The claim made by the appellants m the classification list dated 8-3-1978 and extracted m para 5 above relates to two inputs-(1) bare copper wire upto 25 sq. m. etc. etc. and (2) bare aluminium strips. The way these two inputes described in the classification list, they prima facie appear to us to fall under Items 26A(2) and 27(b) relating to Copper Strips and Aluminium Strip, respect-tively, or under Item 33B relating to Electric Wires & Cables that is, items of the Central Excise Tariff other than Item 68. When we put this point across during the hearing, the appellants requested that they may either be granted an adjournment to examine their invoices and other documents or the case may be remanded to the lower authority for going into this aspect. The Department's representative also could not say off hand whether the inputs in question really fell under Item 68 or under some other item. In the stances, we consider it necessary to remand this aspect of the matter to the Appellate Collector so that refund for the period now allowed by us is granted only after the Appellate Collector is satisfied that the appellants were Sled to set-off in respect of the subject inputs in terms of notification No. 178/,77-CE.5. Accordingly, We modify the imPugned Order-in-Appeal to the extent that the appellant's claim for refund in respect of the period upto 30-6-1978 is held to be within time but we order that this refund may be granted to the appellants only after the Appellate Collector has gone into the master of classification of the subject inputs and satisfied himself that they were classifiable under Item 68-CET. The appeal is disposed of accordingly.