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PETITIONER: ASSISTANT COLLECTOR OF CUSTOMS & ORS.

       Vs.

RESPONDENT: ANAM ELECTRICAL MANUFACTURING CO. ETC.

DATE OF JUDGMENT:       28/01/1997

BENCH: B.P. JEEVAN REDDY, K. VENKATASWAMI

ACT:

HEADNOTE:

JUDGMENT:                THE 28TH DAY OF JANUARY, 1997 Present:             Hon‘ble Mr. Justice B.P. Jeevan Reddy             Hon‘ble Mr. Justice K. Venkataswami K.N. Bhat,  Additional Solicitor  General, G.  Prakash, C.V. Subba Rao, Advs. with him for the appellants D. Ramakrishna Reddy, A.V.V. Nair, S.K. Mehta, Advs. for the Respondents                          O R D E R      The following Order of the Court was delivered:                          O R D E R      Heard the counsel for the parties.      So far  as the  question of  levy of  surcharge of  ten percent which is in issue herein is concerned, we affirm the judgment and  order of  the Madras High Court. So far as the question of refund is concerned, it is obvious that it shall be governed  by the  law declared  in Mafatlal Industries v. Union of India [1996 (9) SCALE 457], read with clause (6) of the format  order, a  copy of  which is  enclosed  herewith, which is as follow:      "Where a  refund application  or an      appeal is  preferred under  and  in      accordance with the directions (1),      (2) (3)  and (4)  above,  the  same      shall be  entertained only  if  the      applicant   for    refund/appellant      files affidavit stating that he has      not passed  on the  burden  of  the      duty, which  is claimed  by way  of      refund, to  another person. In case      the  applicant   for  refund  is  a      company or a society, the affidavit      shall  be  sworn  by  the  Managing      Director or  the Principal  Officer      of the  Company or  the Society,  s      the case  may be. Such an affidavit      shall    be     treated    as    an      averment/assertion     which     an      applicant for refund has to make in      terms of the judgment in Mafatlal.

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    The appeals  are disposed  of in  the above  terms.  No costs.                         F  O R M A T      Pursuant to the directions given in Mafatlal Industries v.  Union   of  India   [  1996   (9)  SCALE   457  ],   the appeals/Special Leave Petitions coming up for disposal shall be disposed  of in  terms of one or the other of the clauses below:      (1)  Where  a  refund  application  was  filed  by  the manufacturer/purchaser beyond  the period  prescribed by the Central Excise Act/Customs Act in that behalf, such petition must be  held to be untenable in law. Even if in any appeal, suit or  writ petition,  direction has  been given  that the refund application  shall be considered without reference to the period  of limitation  prescribed in  the Central Excise Act/Customs Act-  or that  the period of limitation shall be taken as  three years-  such a  direction of  the  Appellate Court/Civil  Court/High   Court  shall   be  deemed   to  be unsustainable in  law and such direction shall be set aside. The period  prescribed by the central excise Act/Customs Act for filing  a refund  application in  the case  of  "illegal levy" cannot be extended by any authority or court.      (2)  where, however,  a refund  application  was  filed within  the   period  prescribed   by  the   Central  Excise Act/Customs Act  but has  been dismissed wholly or partly on any ground  and the said order is questioned by way of a wit petition or  a suit  or any  appeal  arising  therefrom  the manufacturer/purchaser shall  be entitled  to  withdraw  the writ petition,  suit or  an appeal arising therefrom, as the case may  be, and  file an  appeal  before  the  appropriate appellate authority  within sixty  days from  today.  It  is clarified herewith  that even  in a  case  where  such  writ petition has been allowed and an appeal filed by the revenue is pending  , the  writ  petitioner  shall  be  entitled  to withdraw the  writ petition,  in which  event,  the  revenue appeal shall  be disposed  of permitting the writ petitioner to withdraw  the writ petition to pursue the remedy proposed hereby. If  such an appeal is filed, it shall be entertained without raising an objection on the ground of limitation and shall be  dealt with  in accordance with law. This direction shall apply  even in  cases where  the High  Court or  Civil Court is approached after exhausting the remedy of appeal to Collector [Appeals].  He can  file an  appeal to  C.E.G.A.T. within sixty  days from  today, after  withdrawing the  writ petition or the suit, as the case may be.      (3)  where, however,  a writ  petition or suit claiming refund was  filed directly  in the  High  Court/Civil  Court [i.e.,  without   filing  a   refund  application   ].   the petitioner/plaintiff shall be entitled to withdraw such writ petition/suit or  any appeal  arising therefrom and prefer a refund claim  under Section  11(B) within  sixty  days  from today provided  the writ  petition or  suit was filed within the period  prescribed by the Central Excise Act/Customs Act for filing  the refund application. It is clarified herewith that even  in a  case where  such  writ  petition  has  been allowed and appeal filed by the Revenue is pending, the writ petitioner shall  be entitled to withdraw the writ petition, in which  event, the  Revenue appeal  shall be  disposed  of permitted the  writ petitioner to withdraw the writ petition to pursue the remedy proposed hereby.      (4)  The above rules, however, do not apply in the case of a  claim for refund of duty levied and recovered under an unconstitutional provision.  In such  a case,  the period of limitation shall  be prescribed  in Mafatlal Industries. The duty to  allege and  prove that the duty has not been passed

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on to  another person,  or course,  remains even  in such  a case.      (5)  where a person challenges the constitutionality of a provision  in the Central Excise Act/Customs Act in a High Court or  the Supreme  Court but  fails in  his challenge to constitutionality, he  cannot take advantage of the decision in the  case  of  another  person  striking  down  the  said provision, as  explained  in  the  judgment.  This  rule  is evolved in  the particular  context of  refund claims  under these two enactments and has to be observed.      (6)  where  a   refund  application  or  an  appeal  is preferred under  and in  accordance with the directions (1), (2), (3) and (4) above the same shall be entertained only if the applicant  for refund/appellant  files affidavit stating that he  has not  passed on the burden of the duty, which is claimed by  way of  refund, to  another person.  In case the applicant for  refund is company or a society, the affidavit shall be  sworn by  the Managing  Director or  the Principal Officer of  the Company  or the Society, as the case may be. Such an  affidavit shall be treated as an averment/assertion which an  applicant for  refund has  to make in terms of the judgment i Mafatlal.      (7) (a)   Where the  refund claim  is rejected  by this Court, the  assessee who  has already obtained any amount by way of  refund shall  be liable  to pay back the same to the department and  the department  shall be entitled to recover the same in accordance with law.      (b)  If the  refund claim  is rejected  by an authority under the  Act and  where the  assessee has already obtained the refund he shall be liable to pay back the said amount to the department  according to law and the department shall be entitled to recover back the said amount, subject to orders, if any, by and Appellate Authority.