Amount paid during investigation – Can refund claim be time barred?
DDT received this mail –
“I am registered assessee. The preventive officers of the Central Excise Commissionerate visited my unit in the year 2007 and booked a case alleging incorrect availment of Cenvat credit on inputs/input services. Under their pressure, an amount of Rs.55 lakhs was paid by me. A show cause cum demand notice invoking extended period came to be issued six months down the line. The matter was decided by the Commissioner recently in my favour. I, therefore, sought a refund of the amount paid by me in the year 2007.
To my surprise, the jurisdictional officer informed me that the refund claim is ‘time barred’.
Obviously, I could not have had a premonition that the Commissioner would drop the proceedings and that was the reason that I did not file any refund claim in the year when the case was booked and the SCN was issued.
The argument of the officer was that clause (ec) in section 11B does not cover situations like mine and hence filing of refund claim by me after issue of Order-in-original was time barred.
The term “relevant date” has been defined in section 11B, Explanation (B)(ec) as under –
(ec) in case where the duty becomes refundable as a consequence of judgment, decree, order or direction of appellate authority, Appellate Tribunal or any court, the date of such judgment, decree, order or direction;
I have, therefore, tried to argue my case thus – that the amount paid by me during investigation is not duty but a deposit and hence there is no time limit for claiming this amount back from the department. There is another reason for it being called as deposit and that is that in the SCN the department itself had sought appropriation of the amount towards the duty proposed to be recovered. In fact, applying Circular no. , dated 8-12-2004, in the matter of return of pre-deposits, the Department should return the “deposits” made during investigation within a period of three months of the disposal of the SCNs in the assessee’s favour.
I request that DDT highlights my plight and the Board issues necessary instructions in this regard.
Hope the CBEC helps him out