Collector of C. Ex. Vs. Kopran Chemicals Co. Ltd. - Court Judgment

Excerpt:
1. this appeal by the department is directed against the order-in-appeal no. sdk/449/b-ii/91, dated 10-10-1991 of the collector of central excise (appeals), bombay allowing the refund claim filed by the respondents by setting aside the order of rejection thereof passed by the asst. collector of central excise, division iii, bombay-ii vide order no. v (29) 18-64/90, dated 18-4-1991.2. the respondents filed refund claim for rs. 2526.56 and rs. 80,850/- for duty paid on the goods received back under rule 173l of the rules.the claims were rejected only on the ground that form of reprocessing undertaken before re-issue of the goods was not shown. the collector (appeals) however held the respondents had complied with the provisions of rule 173l of the rules in substance and not specifying the process actually undertaken in form v register was merely a procedural lapse which could not result in denial of the refund. he therefore sanctioned the refund.3. mr. gurnani, the ld. dr has pleaded that maintenance of form v register is a statutory requirement and the same provides for due maintenance of complete record of re-processing undertaken and production thereof while claiming refund and here the respondents have not maintained any record in that regard and hence they are not entitled to claim any refund.4. mr. ghadge, the ld. consultant has however referred to the supreme court judgement in union of india v. a.v. namsimhalu -1983 e.l.t. 1534 (sc) where the said court have observed that the government should avoid relying on technicalities and has then referred to a decision of this bench in anil starch products ltd. v. collector - 1992 (57) e.l.t.662 (tribunal) where it is held that substantive compliance of the said provisions could justify availing of the refund. in his submission all the other formalities have been complied with.5. considering the submissions and going by the order passed, it is clear that the goods had been received under d-3 declaration, the goods returned were reprocessed by regrinding and as such reconditioning them for the purpose of re-marketing. the details as to the medicine, the batch numbers etc. were given undertaking re-processing limited to that specific quantity at times, may not be practicable and in that case, mixing them alongwith the similar items indicating with reasonable certainty, about the reprocessing undertaken, could be. construed to be due compliance. the procedural requirements laid down in rule 173l of the rules are basically to provide subjective satisfaction to the concerned officer against misuse of the facility extended and if the record available is sufficient to satisfy the officer concerned, some minor procedural lapse should not be over emphasized to deny otherwise eligible dues.6. the collector (appeals) has satisfied himself of the compliance and has sanctioned the refund and there is no justification in challenging such order on mere technical point. this is also the ratio of the supreme court judgement referred to above.

Judgment:
1. This appeal by the Department is directed against the Order-in-Appeal No. SDK/449/B-II/91, dated 10-10-1991 of the Collector of Central Excise (Appeals), Bombay allowing the refund claim filed by the Respondents by setting aside the order of rejection thereof passed by the Asst. Collector of Central Excise, Division III, Bombay-II vide Order No. V (29) 18-64/90, dated 18-4-1991.

2. The Respondents filed refund claim for Rs. 2526.56 and Rs. 80,850/- for duty paid on the goods received back under Rule 173L of the Rules.

The claims were rejected only on the ground that form of reprocessing undertaken before re-issue of the goods was not shown. The Collector (Appeals) however held the Respondents had complied with the provisions of Rule 173L of the Rules in substance and not specifying the process actually undertaken in Form V Register was merely a procedural lapse which could not result in denial of the refund. He therefore sanctioned the refund.

3. Mr. Gurnani, the ld. DR has pleaded that maintenance of Form V Register is a statutory requirement and the same provides for due maintenance of complete record of re-processing undertaken and production thereof while claiming refund and here the Respondents have not maintained any record in that regard and hence they are not entitled to claim any refund.

4. Mr. Ghadge, the ld. Consultant has however referred to the Supreme Court judgement in Union of India v. A.V. Namsimhalu -1983 E.L.T. 1534 (SC) where the said court have observed that the Government should avoid relying on technicalities and has then referred to a decision of this Bench in Anil Starch Products Ltd. v. Collector - 1992 (57) E.L.T.662 (Tribunal) where it is held that substantive compliance of the said provisions could justify availing of the refund. In his submission all the other formalities have been complied with.

5. Considering the submissions and going by the order passed, it is clear that the goods had been received under D-3 declaration, the goods returned were reprocessed by regrinding and as such reconditioning them for the purpose of re-marketing. The details as to the medicine, the batch numbers etc. were given undertaking re-processing limited to that specific quantity at times, may not be practicable and in that case, mixing them alongwith the similar items indicating with reasonable certainty, about the reprocessing undertaken, could be. construed to be due compliance. The procedural requirements laid down in Rule 173L of the Rules are basically to provide subjective satisfaction to the concerned officer against misuse of the facility extended and if the record available is sufficient to satisfy the officer concerned, some minor procedural lapse should not be over emphasized to deny otherwise eligible dues.

6. The Collector (Appeals) has satisfied himself of the compliance and has sanctioned the refund and there is no justification in challenging such order on mere technical point. This is also the ratio of the Supreme Court judgement referred to above.