Full Judgment
2. Shri S.C. Pushkarna, learned Departmental Representative, submitted that there was a classification dispute regarding the product manufactured by the respondents who had declared their products as 'bars' falling under sub-Heading 7214.90 of the Schedule to the Central Excise Tariff Act whereas the Department classified it as 'flat' falling under sub-Heading 7211.19 / 7211.30; that during the disputed period the respondents had discharged the duty liability at higher rate; that the classification dispute had been decided by the Appellate Tribunal in favour of the respondents vide Order No. E/216-379/90 DI dated 20.12.90; that the Appeal filed by the Revenue in the Supreme Court was also decided in favour of the Respondent on 24.7.95 holding that the impugned product as 'bar'; that the respondents had filed the refund claim for refund of duty on 19.5.2000 for the period 3.7.89 to 7.11.89; that the Deputy Commissioner under Order-in-Original No.286/2000 dated 26.4.2000 rejected the refund claim as time barred; that, however, on Appeal, the Commissioner (Appeals) has allowed the refund claim. He, further, submitted that the Commissioner (Appeals) has wrongly held that the protest once lodged stands only disposed of by the Competent Authority; that when the higher appellate Authority has decided the matter, it is binding on lower authorities and by issue of such Order, the protest gets disposed of automatically; that as in the present matter, the classification was decided in favour of the Respondent in December 1990, the protest got vacated and they were eligible to the refund claim of the duty paid by them within the time specified under Section 11B of the Central Excise Act; that as the refund claim had been filed in May 2000, it is time barred.
3. Countering the arguments, Shri Sandeep Singh, learned Advocate submitted that once the protest has been lodged by the assessee, it is required to be disposed of and as protest lodged by them has not been disposed of by the Competent Authority, it continues, to exist and accordingly, the refund claimed by the respondents is not hit by time limn. The learned Advocate also mentioned that the second proviso to Section 11B(1) of the Act clearly provides that the limitation of six months shall not apply where any duty has been paid under protest; that the vacation of the protest after the Tribunal has passed the orders in their favour is for the subsequent period and it does not affect the protest lodged by them for the earlier period.
4. In reply the learned Departmental Representative relied upon the decision of the Tribunal in the case of Hilton Rubbers Ltd. v. CCE, Delhi 2002 (148) ELT 538 wherein the Tribunal has held that the refund claim filed after two years and four months of the approval of the Classification List, is clearly barred by time though the duty was paid under protest; that Supreme Court has dismissed the Civil Appeal 6190/1999 filed by Hilton Rubbers Ltd., 2003 (153) ELT A 96 (SC).
5. I have considered the submissions of both the sides. It is not in dispute that the classification dispute between the Department and the respondents got settled by the decision of this Tribunal passed in December 1990. Once the question of classification on account of which the duty was paid under protest has been decided initially by the Competent Adjudicating Authority and later on by the Appellate Authority, the question of protest remaining continued does not arise.
The Appellants became eligible to claim refund of duty as soon as the Order was passed by the Tribunal in December 1990 and the operation of which was not stayed. As per the provisions of Section 11B of the Central Excise Act, a refund claim has to be filed within six months from the relevant date. The second proviso to Section 11B(1) of the Central Excise Act provides that limitation of six months shall not apply where any duty has been paid under protest. The impugned protest stands vacated automatically once the decision in favour of the assessee has been passed by the Appellate Tribunal. I do not agree with the learned Commissioner (Appeals) that a separate Order has to be passed by the Competent Authority to vacate the protest. As the refund claim in the present matter has been filed in May 2000, the same is barred by limitation provided under Section 11B (1) of the Act. This was the view taken by the Tribunal in the case of Hilton Rubbers (Supra) which has also been confirmed by the Supreme Court. I accordingly, allow the Appeal filed by the Revenue.