1. Appeal under Section 35-B of the Central Excises and Salt Act, 1944, praying that in the circumstances stated therein, the Tribunal will be pleased to set aside the order of the Collector of Central Excise directing recovery of the refund granted under section 11-A of the Central Excises and Salt Act, 1944.
2. This appeal coming up for orders upon perusing the records and upon hearing the arguments of Shri P.N. Menon, representative of the appellants and upon hearing the arguments of Shri S.K. Choudhury, Senior Departmental Representative for the respondent, the Tribunal makes the following order : 3. The Assistant Collector of Central Excise, Madras VII Division, issued a cheque dated 19-10-1981 for Rs. 27.909/- in respect of payments made by the appellants for goods manufactured by them during the period 1-4-78 to 18-1-80 and which had been classified under Item 68 of the Central Excise Tariff up to 16-7-79, and under Item 51-A thereafter. The Collector of Central Excise, Madras, reviewed the decision of the Assistant Collector to grant refund and passed an order-in-revision C. No. III/l0/1700/81-IA (RC) dated 19-11-81 under Section 35A of the Central Excises and Salt Act, 1944. By this order, he found that the appellants had filed the refund application in respect of the amount only on 28-11-80 and that it was barred by limitation under the then existing Rule 11 of the Central Excise Rules, 1944. He, therefore, set aside the decision of the Assistant Collector and ordered recovery of the sum already granted as refund.
4. The representative of the appellants contends that in his order No.3/79, dated 16-10-80 itself, the Assistant Collector had given a finding that the appellants are eligible for exemption under Notification No. 71/78, dated 1-3-78; the sanction and payment of refund was pursuant to this finding. If the date of this order is to be taken as the relevant date, the review proceedings by the Collector are barred by limitation.
5. The Senior Departmental Representative urges that the order of 16-10-80 referred to by the representative of the appellants does not at all deal with payment of duty for the period 1-4-78 to 18-1-80. It deals with a demand for duty short levied for the period 18-6-77 to 31-3-78. In adjudicating this demand, the Assistant Collector had occasion to observe that the appellants could have availed of the exemption under Notification No. 71/78. He, therefore, did not enforce the demand for differential duty for the month of March 1978 but confined it in respect of the period prior to it. The note order of the Assistant Collector sanctioning the refund referred to in the present proceedings is dated 17-10-81 in the relevant file of the department; the cheque itself is dated 19-10-81. In terms of Section 11-A(3)(ii)(c) read with Section 35-A of the Central Excises and Salt Act, 1944 notice to show cause can be issued within six months from the date of erroneous refund. In this view, the revisionary proceedings are not barred by limitation.
6. We have perused the order No. 3/79 of the Assistant Collector dated 16-10-80. We are clear in our mind that that order deals with the assessability of the goods produced by the appellants during a period ending 31-3-78. A mere observation en passe of the Assistant Collector that the appellants are eligible to avail exemption under Notification No. 71/78 does not tantamount to a finding in respect of duties payable or paid on or after 1-4-78. As the revisionary proceedings have been initiated within a year from the date of the decision of the Assistant Collector and within six months from the date of erroneous refund, they are not barred by limitation.
7. The representative of the appellants refers us to the observations of the Supreme Court in the case of Aluminium Corporation of India Ltd. v. Union of India and Ors. (Civil Appeal No. 677 of 1968 reported in ECR compilation of Central Excise cases, Supreme Court Judgment 1932-1982 p. 466). In para 17 of the judgment, His Lordship Justice Krishna Iyer has observed : "To return what has been taken wrongly is as much a duty and grace of government as to levy relentlessly and fully what is due. Default in either, not altogether unfamiliar, brings down the confidence of the community in the Administration. That a party should have been put to too expensive, and elongated litigations to recover a relatively small sum is regrettable." This observation of His Lordship Justice Krishna Iyer expresses a certain desire as to the conduct of the government in regard to amounts wrongly taken by them. If, in terms of the Act, the amount collected is not refundable being barred by provisions of limitation and if the Department chooses to claim the bar prescribed under the Act, it is not for this Tribunal to refuse to enforce the provisions of the Act. In the result, the appeal is dismissed