CAPRIHANS INDIA LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) BY this petition filed under Article 226 of the Constitution of India, the petitioners are challenge legality of order dated April 27, 1989 passed by Assistant Collector, Central Excise, thane III Division, Thane holding that the petitioners are not entitled to the refund claim of Rs. 3,19,985. 39. The facts leading to the passing of this order are not in dispute.

(2.) THE petitioners are engaged in the activity of manufacture of PVC films and sheetings and decorative laminates, etc. Prior to the year 1981, the petitioners manufactured industrial laminates in different grades which are used as electrical insulations and fittings. The petitioners erroneously classified the said item under the erstwhile Tariff Item No. 68. The duty, was therefore erroneously paid at 30% ad valorem and special duty at 5% of the basic instead of 8% ad valorem. Consequently, the petitioners erroneously paid excise duty in the sum of Rs. 476394. 07, for the period between October 1980 and upto March, 1981.

(3.) THE petitioners field claim for refund before the Assistant Collector, Central Excise, Thane on may 26, 1981. The claim was subsequently reduced to Rs. 3,19,985. 89. Initially, the Assistant collector, by order dated September 9, 1981 rejected the claim but the order was set aside in appeal by Collector of Central Excise (Appeals), Bombay, by order dated September 26, 1986. The Appellate Collector held that the item was classified under residuary Tariff Item No. 68. The department carried appeal before Customs, Excise and Gold (Control) Appellate Tribunal, but the same was rejected by order dated December 5, 1987. Thereafter, the Assistant Collector passed the impugned order rejecting the claim on the ground that the assess Company is not eligible for the refund claim in view of the decision of the High Court in the case of Roplas (India) Limited v. Union of India reported in 1988 (38) Excise Law Times 27 (Bombay ). The assistant Collector felt that grant of refund would amount to unjust enrichment in favour of the petitioners. The Assistant Collector rejected the claim of refund only on the ground of decision of High Court in M/s. Roplas Limited case. The order of Assistant Collector is under challenge in this petition filed under Article 226 of the Constitution of India.