Syrian Arab Airlines Vs. Commissioner of Customs - Court Judgment

Excerpt:
1. granting the prayer for early hearing, the appeal was taken up for disposal.2. the appellants paid foreign travel tax amounting to rs. 3,26,7007- for the month of august, 1996 twice, once in october 1996 and once in january 1997. this error came to their notice during the course of audit. they thereafter filed an application for refund on 9-2-1998. the assistant collector held that in terms of the relevant rules, the application for refund had to be made before expiry of six months from the date of payment of the tax in respect of which the refund was claimed. he dismissed their claim as barred by limitation. the commissioner (appeals) having upheld the dismissal, the present appeal is before us.2. shri v.m. adwani ld. counsel appearing along with shri rajesh shah, advocate submitted that the issue of refund should be governed under the indian contract act, where it is the liability of a person who has wrongly received any amount to return it to the person who gave the amount.3. the issue whether the limitation prescribed under the parent act would apply where the tax was collected wrongly, has been the subject matter of litigation. the view earlier held by the bombay high court was that in such cases the general law of limitation would apply. the controversy was settled by the judgment of the supreme court in the case of collector of central excise v. doaba co-operative sugar mills 1988 (37) e.l.t. 478 (s.c.). the supreme court held as under : - "but in making claims for refund before the departmental authority, an assessee is bound within four corners of the statute and the period of limitation prescribed in the central excise act and the rules framed there-under must be adhered to. the authorities functioning under the act are bound by the provisions of the act".4. this judgment has been followed by the supreme court in the later judgment in the case of porcelain electrical mfg. co. v. collector of central excise 5. following the law so laid down, the order of the commissioner (appeals) is upheld and this appeal is dismissed.

Judgment:
1. Granting the prayer for early hearing, the appeal was taken up for disposal.

2. The appellants paid Foreign Travel Tax amounting to Rs. 3,26,7007- for the month of August, 1996 twice, once in October 1996 and once in January 1997. This error came to their notice during the course of audit. They thereafter filed an application for refund on 9-2-1998. The Assistant Collector held that in terms of the relevant Rules, the application for refund had to be made before expiry of six months from the date of payment of the tax in respect of which the refund was claimed. He dismissed their claim as barred by limitation. The Commissioner (Appeals) having upheld the dismissal, the present appeal is before us.

2. Shri V.M. Adwani ld. Counsel appearing along with Shri Rajesh Shah, Advocate submitted that the issue of refund should be governed under the Indian Contract Act, where it is the liability of a person who has wrongly received any amount to return it to the person who gave the amount.

3. The issue whether the limitation prescribed under the Parent Act would apply where the tax was collected wrongly, has been the subject matter of litigation. The view earlier held by the Bombay High Court was that in such cases the general law of limitation would apply. The controversy was settled by the judgment of the Supreme Court in the case of Collector of Central Excise v. Doaba Co-operative Sugar Mills 1988 (37) E.L.T. 478 (S.C.). The Supreme Court held as under : - "But in making claims for refund before the departmental authority, an assessee is bound within four corners of the statute and the period of limitation prescribed in the Central Excise Act and the Rules framed there-under must be adhered to. The Authorities functioning under the Act are bound by the provisions of the Act".

4. This judgment has been followed by the Supreme Court in the later judgment in the case of Porcelain Electrical Mfg. Co. v. Collector of Central Excise 5. Following the law so laid down, the order of the Commissioner (Appeals) is upheld and this appeal is dismissed.