1. Notification No. 198/76-C.E. gave partial concession from Central excise duty to certain specified goods. This concession was in the nature of an incentive for higher production. Tea was one of the commodities eligible for this concession. The instructions issued by the Department required that the assessees desirous of availing of the concession should apply to the Assistant Collector with necessary details of their base period and base period clearances. The instructions further stated that the assessee's refund claim for the incentive rebate would be sanctioned only after the Assistant Collector had approved the Base period and the base period clearances in respect of the concerned assessee.
2. The appellants applied to the Assistant Collector for the concession and furnished all the required particulars by 23-5-1978. The period during which they made excess clearances and to which their refund claim pertains is 9-1-79 to 31-3-79. The Assistant Collector, determined their base period and base clearances in terms of the notification on 29-12-79. Soon thereafter, on 12-2-80, the appellants filed their specific refund claim for the incentive rebate. The Assistant Collector sanctioned the claim. The Collector, however, initiated review proceedings, set aside the Asst. Collector's order and rejected the appellants' claim as time-barred under Rule 11 of the Central Excise Rules, 1944 on the ground that the claim filed on 12-2-80 was beyond the prescribed time-limit of six months.
3. During the hearing before us today, the appellants stated that there could be no question of limitation for their refund claim filed on 12-2-80 since the quantum of excess amount paid became crystalised or specified or quantified only on 29-12-79 when the base clearance was fixed by the Asst. Collector. They added that the appellants had been constantly pressing the Department for the fixation of the base year and base year clearances without which it was impossible for them to either determine the value or the rate of duty in order to adjust the duty. But the Department took a long time in fixing their base period and base clearances.
4. The Department's representative stated that the appellants had not asked for the exemption in their classification list, that the Department's instructions requiring prior approval of the base period and base clearances by the Asst. Collector were not statutory ones and could not, therefore, override the statutory provisions of Rule 11 and that it was open to the appellants to start paying duty under protest as soon as they felt that their excess clearances had started. But the appellants did not do so. Their refund claim was, therefore, correctly rejected as time-barred by the Collector.
5. We have carefully considered the matter. According to Rule 173-B, the appellants had to pay duty at the rate approved in their classification list. They desired to avail of the incentive rebate given under notification No. 198/76-C.E. but the Department's instructions laid down that they could do so only after their base period and base clearances had been approved by the Assistant Collector. On their part, the appellants applied for the concession and gave all the necessary particulars well in advance, about 8 months prior to the start of their excess clearances. There is force in the appellants' plea that unless the Assistant Collector had fixed their base period and base clearances, they were neither in a position to avail of the concession on their own nor quantify their refund claim.
They could not even know as to when exactly their excess clearances would start. The Assistant Collector took time in giving his approval and soon thereafter they quantified the amount of the concession admissible to them and filed a specific refund claim. In such a setting, it has to be held that when the appellants applied to the Assistant Collector with the declaration of their base period and base clearance particulars, they staked their claim for the exemption under the notification. Quantification of their refund claim, which could be done only after the Assistant Collector's approval to their base period and base clearances, was in continuation of the initial claim. In the facts of this case, the quantification of the claim cannot be taken in isolation. Since the appellants had staked their claim well in time it was not necessary for them to pay duty under protest. Accordingly, we hold that the appellants' refund claim was not time-barred. The appeal is allowed with consequential relief to the appellants.