Dr. ANAND, J. - (1.) This appeal, by special leave, is directed against the judgment and order of the High Court of Delhi in Civil Writ No. 971 of 1978 dated 12-4-1982.
(2.) The respondent, carries on the business of manufacturing and selling cigarettes and smoking tobacco at its five cigarette factories including one at Saharanpur in the State of U. P. The respondent sells its products to whole-sale buyers or dealers who make further sales to secondary wholesalers from where the products reach the retailers and the consumers. During the period September 1, 1970, to February 28, 1973, the respondents followed the self removal procedure laid down in Chapter VIIA of the Central Excise Rules on payment of excise duty, as the manufacture of cigarettes affects excise duty under the Central Excises and Salt Act, 1944 (hereinafter the Act). The case of the respondent in the writ petition was that under a mistake of law regarding the true interpretation of Section 4(a) of the Act, it cleared its products but paid excess excise duty under the impression that the prices charged by the whole-sale dealers to the secondary whole-salers would form the correct basis of assessment and not the price at which goods were sold to whole-sale dealers. Consequent upon the judgment of this Court in the case of A. K. Roy v. Voltas Limited, (1973) 3 SCC 503: (1973) 2 SCR 1089, wherein it was held that under Section 4(a) of the Act, the value for the purpose of assessment is required to be determined on the basis of the price at which the manufacturer sells the products to the whole-sale dealers and not the price at which the whole-sale dealers further make a sale of the product to secondary wholesalers, the respondents filed five applications before the appropriate authority under the Act seeking refund of the excess excise duty paid under mistake of law. Two applications pertained to the period 1-9-70 to 28-5-71 and 1-6-71 to 19-2-72 involving refund of Rs. 23,68,686.85 and Rupees 26,21,356.16 respectively. The other three applications, related to the period 20-2-72 to 28-2-73. The Assistant Collector of Central Excise by his order dated 9-10-73 rejected all the five applications. The respondent preferred appeals before the Collector of Central Excise (Appeals). The Appellate Collector by an order dated 30-12-75, allowed the appeals arising out of the three refund applications relating to the period 20-2-72 to 28-2-73, and set aside the orders passed by the Assistant Collector and ordered consequential relief in favour of the respondent by directing the refund of the excess excise duty paid. The appeals pertaining to the refund applications for Rupees 23,68,686.85 and Rs. 26,21,356.16 for the period 1-9-70 to 28-5-71 and 1-6-71 to 19-2-72 respectively were however, rejected by the Collector (Appeals) on the ground that the same were barred by time. The respondents did not take the matter further under the statute but instead filed W.P. No. 971 of 1976 seeking quashing of. the order of the Collector of Central Excise (Appeals) dated 30-12-75 and also sought a direction by way of mandamus for refund of the sum of Rs. 49,90,043.01 with interest @ 12% per annum thereon. The Division Bench of the High Court came to the conclusion that on account of a mistake of law, excess excise duty had been paid by the respondent and received by the Department. The Bench held that there was a legal obligation on the part of the Government to return the excess excise duty received/ recovered by it since the same was not payable by the party. Relying upon their earlier judgment in Chemicals and Plastics v. Union of India, C.W.P. No. 147/79 decided on 10-7-79, the Division Bench allowed the writ petition filed by the respondents herein and held that the respondent could not be non-suited on the ground of limitation. The Court set aside the order of the Collector, Central Excise (Appeals) and directed the Department to refund the sum of Rs. 49,90,043.01 to the respondent. The Bench observed: "The duty of excise can be which is levied in accordance with the act and any money which is realised in excess of what is permissible in law would be a realisation made outside the provisions of the Act. The payment of the excess excise duty which has been made by the petitioners for the period September 1, 1970 to February 19, 1972 cannot be legally termed as payment of excise duty authorised by law as the authorities under the Act themselves did not treat the excess duty in identical circumstances paid for the subsequent period from February 20, 1972 to February 28, 1973, as authorised by law. The excess excise duty was not payable by the petitioners under the Act and there is a corresponding legal right in the petitioners to recover it. This right cannot be defeated by a mere limitation in the Act or the Rules when the collection is without the authority of law." The Department was directed to refund to the respondent the sum of Rupees 23,68,686.85 plus Rs. 26,21,356.16 "or such other lesser sum as may be found on verification to be due" within a period of six months from the date of the judgment i.e. April 12, 1982. Aggrieved, by the judgment of the High Court, the Department filed special leave petition and on 8-10-82 special leave was granted. In the stay application filed by the Union of India, the Bench directed the appellant to pay to the respondent the amount which it was required to refund under the impugned judgment within a period of six weeks of the respondent furnishing bank guarantee to the Collector of Central Excise, Meerut for the said amount and that in case, the respondent fails in this appeal, it shall refund the amount with interest @ 12% per annum to the appellants.
(3.) On 15-4-93, when the case came up for hearing before us, learned Counsel for the appellants raised the plea based on Section 11B, as amended by the Amendment Act, 40 of 1991, to deny refund to the respondent. After hearing learned Counsel for the parties, we directed the respondent to "furnish documentary or other evidence as the respondent may deem appropriate to establish that the amount of duty of excise in relation to which the refund is claimed was collected from or paid by him and the incidence of such duty had not been passed on by him to any other person". The appeal was directed to be posted for hearing on 10-5-93. The respondents did not file any documentary or other evidence nor even an affidavit stating that the incidence of duty of excise in relation to which the refund was being claimed had not been passed on to any other person. The arguments were heard finally on 14-5-93 and the judgment was reserved, though liberty was granted to learned Counsel for the parties to file written submissions if any in support of their arguments. The respondent filed written submissions on 31-5-93. Along with the written submissions an affidavit was also filed. No other material or documentary evidence, to establish that the burden of excess excise duty had been borne by it and not passed on to any other person, was filed. The Union of India filed their written submissions on 21-6-93.;