The appellants are engaged in the manufacture of sugar falling under Chapter 17 of Central Excise Traffic Act, 1985. The appellants claimed the rebate on excess production of sugar for the period 1.12.74 to 30.9.75 under the provisions of Notification No. 146/74-CE dated 12.10.74. The Central Excise authorities sanctioned the rebate of Rs. 15,24,314 out of the total claim of Rs. 26,35,142.65 on the ground that excess production has to be calculated on the average production.
2. Being aggrieved on the above mode of calculation of excess production and consequent disallowance of a part of the rebate claim, the appellants filed writ petitions before the Hon'ble High Court of Madras. The said writ petitions were decided by the High Court on 28.9.79 who allowed the same and as a result the appellants took the differential credit of Rs. 11,19,828 in their accounts on 18.2.80.
3. However, the Revenue did not accept the Hon'ble High Court's order and filed Civil Appeals there against before the Division Bench of the High Court. The said appeals were dismissed by the High Court vide their order dated 12.8.85. Thereafter, the Revenue filed an appeal before the Hon'ble Supreme Court. The Hon'ble Supreme Court in its order dated 30.3.93 in the case of CCE v. Neoli Sugar Factory (to which appellant was also one of the respondents) reported in JT 1983 (2) SC 557 set aside the order of the Hon'ble High Court. Thereafter, the appellants herein filed a review petition before the Hon'ble Supreme Court which was also dismissed.
4. Subsequently, the issue regarding the availability of rebate on the excess production of sugar was referred by another bench of the Hon'ble Supreme Court to the bench of three Judges in the case of The Saswad Mali Sahakari Sakhar Karkhana Limited v. Union of India and Anr. Vide its order dated 11.11.94, the Hon'ble Supreme Court held that the earlier view expressed in Neoli Sugar Factory's case was not the correct view and the excess production has to be calculated not on the average production but on the excess production and accordingly the claim of sugar factories in those case was decided in their favour. In view of subsequent judgment passed in the case of Saswad Mali Sahakari Sakhar Karkhana Ltd. v. UOI the appellants filed a refund application before the Asst. Commissioner that the duty paid in consequence of their having lost to the case before the Hon'ble Supreme Court was within six months from the relevant date and hence under Section 11B, the refund be given to them notwithstanding the fact that the earlier case before the Supreme Court was against them. They contended that in view of changed law by the Larger Bench of the Supreme Court, the refund is payable to them. The AC accepted the above stand of the appellants and regularised the reversal of the credit by the appellants.
5. Being aggrieved with the above order of the AC, the Revenue filed an appeal there against before the Commissioner (Appeals). The said appellate authority accepted the appeal of the Revenue by observing that the demand of duty was in consequence to the Hon'ble Supreme Court's decision against the appellants and the said decision having attained finality insofar as the appellant was concerned, the benefit of the subsequent changed view is not available to the appellants.
Hence the present appeal.
6. We have heard Shri T.R. Senthil Kumar, learned Advocate appearing for the appellants and Shri C. Mani, learned JDR for the Revenue.
7. The appellant's contention is that the view of the Hon'ble Supreme Court in the case of Neoli Sugar Factory, to which admittedly the appellant was one of the respondents, was held to be incorrect view by the Hon'ble Three Member bench of the Supreme Court in a subsequent decision. He draws our attention to the subsequent judgment dated 11.11.94 wherein in para-8 of their judgment, it has been observed that "We, therefore, say with respect that the view taken in Neoli Sugar Factory's case is not correct. May we add that in that case the Bench did not apply its mind much on the controversy as both the sides had taken a common stand, which being not so here, we felt called upon to find out the true support of the Notification". As such submits the learned Advocate that the view of the Supreme Court in Neoli Sugar Factory's case heaving been held to be incorrect, they are entitled to the benefit of the subsequent law declared by the Supreme Court. For the above proposition, learned advocate refers to another decision of the Hon'ble Supreme Court in the case of U.P. Pollution Control Board and Ors., v. Kanoria Industrial Ltd. and Anr., 8. Shri C. Mani, learned JDR appearing for the Revenue submits that dispute has travelled up to Hon'ble Supreme Court and the appeals filed by the Revenue were allowed. Thereafter, the review petition filed by the said manufacturer has also been rejected by the Hon'ble Supreme Court. In this view of the matter, the appellant's case having attained finality cannot be allowed to be re-opened in view of changed law. He submits that if such re-openings are allowed, there would not be any judicial discipline. He submits that it is well settled law that any order which has attained finality is binding between the parties inter se to the case. He also refers to the Supreme Court's decision in the case of Mafatlal Industries relied upon by the Commissioner (Appeals).
9. We have carefully considered the submissions made by both sides.
There is no dispute as regards the facts of the present case are concerned. The disputed issue of interpretation of the notification on rebate on excess production of sugar has travelled up to Hon'ble Supreme Court in the appellant's own case. The Hon'ble Supreme Court while dealing with the appeals filed by the Revenue against the Madras High Court's verdict has held against the appellants. As such the dispute between the parties i.e. Revenue and the appellants finally stands settled, as a result of which the appellants were to pay back the amounts of credit which they had availed on the basis of Madras High Court's judgment. The Hon'ble Supreme Court in the case of Mafatlal Industries v. UOI, 2002 (83) ECC 85 (SC) : 1997 (89) ELT (SC) has held that refund of duty cannot be claimed unless the order is set aside according to law. So long as the order stands, the duty cannot be recovered back nor can any claim for its refund be entertained. Merely because a different view has been taken subsequently, it does not automatically reopen 'lis' between the two parties, which had become final by the earlier order of the Court. Assessee was not a party to the subsequent verdict given by the Three Member bench decision and as such though the law declared by the subsequent decision would be applicable to all the assessees whose disputes are still pending and have not been decided or the same may be applicable to the present appellants for the period other than the one which already stands decided by the Supreme Court in their own case. The appellant's success or failure in a particular case is depending upon the outcome of proceedings in their own case and the finality of the proceedings cannot be made ineffective merely because in a subsequent case in the matter of some other assessee the Court has taken a different view. We also feel that the Hon'ble Supreme Court's decision in the case of U.P.Pollution Control Board and Ors., v. Kanoria Industrial Ltd. and Anr.
relied upon by the appellant is not applicable to the facts of the instant case inasmuch as in that case, the Hon'ble Supreme Court was deciding the validity of the particular provision and held that when the validity or the levies challenged and when the Supreme Court declares the law and held a particular levy to be valid or invalid, it is wrong to contend that the law laid down by the Supreme Court in that judgment would bind only those parties who were before the Court and not other in respect of whom the appeals had been filed. We find that in that case the assessees became entitled to refund on account of having challenged the validity of the particular provision whereas in the instant case the appellant's appeal is based on the interpretation of a particular notification, the dispute regarding which has finally been decided by the Hon'ble Supreme Court between the appellants and the Revenue. Allowing of their refund claim subsequently would amount to reversing the Hon'ble Supreme Court decision between the two parties which cannot be permitted under the law.
10. In view of the aforesaid discussion, we do not find any merit in the appeal and accordingly reject the same.