In CIVIL APPEAL No. 8717 OF 2022-SC- While making claim for rebate of duty under Rule 18 of Central Excise Rules, 2002, period of limitation prescribed u/s 11B of Central Excise Act has to be applied: Supreme Court
Justices M.R. Shah &  M.M  Sundresh [29-11-2022]

 

Read Judgment: SANSERA ENGINEERING LIMITED V. DEPUTY COMMISSIONER, LARGE TAXPAYER UNIT, BENGALURU 

Mansimran Kaur

New Delhi, November 30, 2022: While placing reliance upon the Central Excise Act, 1944 & Central Excise Rules, 2002, the Supreme Court has opined that merely because there is no reference of Section 11B either in Rule 18 or in the 2004 Notification on the applicability of Section 11B, it cannot be said that the parent statute (Section 11B) shall not be applicable at all.

The Division bench of Justice M.R. Shah and Justice M.M  Sundresh dismissed the present appeal by observing that as the respective claims were beyond the period of limitation of one year from the relevant date, the same were rightly rejected by the appropriate authority and the same are rightly confirmed by the High Court.

Facts leading to the present appeal were that  the appellant herein – M/s Sansera Engineering Limited was a manufacturer of excisable goods. It exported goods on payment of excise duty between August, 2015 and October, 2015 and filed claims for rebate of duty paid on the goods exported on February 10, 2017 to the tune of Rs. 29,47,996 and Rs. 42,27,928 under Rule 18 of Central Excise Rules, 2002 in respect of these exports. 

Subsequently on February 14, 2017  for the period October 2015 to March 2016, the appellant claimed a rebate of Rs. 1,47,27,766.

 The original authority rejected the above-mentioned rebate claims as barred by time prescribed under Section 11B of the Act vide three different Orders-in-Original. Aggrieved by the respective Orders, the appellant preferred writ petitions before the  Single Judge. 

The  Single Judge vide common order dismissed the said writ petitions holding that the claims for rebate were made beyond the period of one year prescribed under Section 11B of the Act. This judgment had been confirmed by the Division Bench. Hence, the present appeal was filed.

The issue before the Bench was whether the claim for rebate of duty provided under Rule 18 of the Central Excise Rules, 2002, the period of limitation prescribed under Section 11B of the Central Excise Act, 1994 shall be applicable or not.

In view of the same, the Court took into account Section 11B of the Act and opined that Section 11B shall be applicable with respect to claim for rebate of duty also. As per Explanation (A) to Section 11B, refund includes rebate of duty of excise. 

As per Section 11B (1) of the Act, any person claiming refund of any duty of excise (including the rebate of duty as defined in Explanation (A) to Section 11B of the Act) has to make an application for refund of such duty to the appropriate authority before the expiry of one year from the relevant date and only in the form and manner as may be prescribed, the Court stated. 

It was further noted by the Court that merely because in Rule 18 of the 2002 Rules, which is an enabling provision for grant of rebate of duty, there is no reference to Section 11B of the Act and/or in the notification dated 6.9.2004 issued in exercise of powers conferred by Rule 18, there is no reference to the applicability of Section 11B of the Act, it cannot be said that the provision contained in the parent statute, namely, Section 11B of the Act shall not be applicable, which otherwise as observed hereinabove shall be applicable in respect of the claim of rebate of duty.

At this stage, it was noted that Section 11B of the Act is a substantive provision in the parent statute and Rule 18 of the 2002 Rules and notification dated September 6, 2004  can be said to be a subordinate legislation. 

“The subordinate legislation cannot override the parent statute. Subordinate legislation can always be in aid of the parent statute”, the Bench said while noting that the application for rebate of duty has to be made in such form and manner as prescribed in notification dated September 6, 2004. The Bench also concurred with the view expressed in the judgment in Everest Flavours Ltd. v. Union of India where it was held that statutory provision for refund in Section 11B rings within its purview, a rebate of excise duty and Rule 18 of the 2002 Rules cannot be read independent of requirement of limitation prescribed in Section 11B.

Thus, the Bench held “...while making a claim for rebate of duty under Rule 18 of the Central Excise Rules, 2002, the period of limitation prescribed under Section 11B of the Central Excise Act, 1944 shall have to be applied and applicable”.

As per the Bench, as the respective claims were beyond the period of limitation of one year from the relevant date, the same were rightly rejected by the appropriate authority and the same were rightly confirmed by the High Court. Hence, the Court failed to find any reason to interfere with the impugned judgment passed by the High Court. Under such circumstances, the present appeal was accordingly dismissed.