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June 2011

(2011) 22 STR 253 (Tri.-Bang.) — Kunj Behari Dye Chem Pvt. Ltd. v. CCE (Appeals II), Bangalore.

By Puloma Dalal
Jayesh Gogri
Chartered Accountants
Reading Time 1 mins
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Refund of pre-deposit — On a favourable decision pre-deposit should be refunded suo motu by the Department without much delay — Time limit for claiming refund not to apply for refund of pre-deposit — Appeal allowed.

Facts:
The appellants were entitled for refund of predeposit amount of Rs.50,000 in view of favourable order of the Commissioner(A). The refund accrued in the year 2001 but the appellants filed a refund claim in the year 2007. Hence, by applying the law of limitation, the refund claim was rejected.

The appellants relied on Board’s Circular dated 2-1-2002, wherein it was clarified that claim for refund of pre-deposit is not required to be filed by appellants and a mere letter would be sufficient. Apart from this, time limit u/s. 11B of Central Excise Act for claiming refund was held inapplicable to refund of pre-deposit implying that the Revenue ought to have suo motu refunded the same.

Held:
Refund claim of pre-deposited amount cannot be rejected by applying the General Limitation Act. The pre-deposit amount should be refunded by the Department suo motu without much delay.

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