Persons eligible for refund
Though section 11B of the Central Excise Act, 1944 authorizes any person to apply for refund but the fact that the applicant is to furnish evidence of payment of excise duty in respect of which the refund is claimed restricts the scope of the term 'any person' used in the provision. Accordingly, in effect, a refund can be claimed only by the manufacturer. It is only in the case of exports under claim for rebate that an exception has been made to this principle. In that case, a merchant exporter is also entitled to claim rebate even though the duty has been paid by the manufacturer of the goods.
Procedure for claiming refund
An application for refund of duty is to be made in duplicate to the Assistant Commissioner of Central Excise having jurisdiction over the factory of the manufacturer, in the proper form. The application is to be accompanied by the documents evidencing payment of excise duty by the assessee and evidence showing that the incidence of duty has not been passed on to the customers.
The refund application is scrutinized and if it is found that the whole or any part of duty paid by the applicant is refundable is not hit by the provisions of unjust enrichment which means that the incidence of duty has not been passed on to the customer, an order is made in favor of the applicant. But if the refund is hit by the provisions of unjust enrichment, the amount so determined is credited to consumer welfare fund. Apart from the requirements laid down in section 11B certain procedural requirements have also been prescribed in the relevant provisions such as Rule 173L and notification no. 85/87 -CE dated 1.3.97 as amended issued under Rule 57F(13).
Refund - limitation and relevant date.
Under the provisions of section 11B, a claim for refund is maintainable only if it is filed within the period of 6 months from the relevant date. A claim filed after the stipulated period is barred by limitation. The relevant dates in respect of refunds arising out of various circumstances is defined under the section. The circumstances of refund and the corresponding relevant date are tabulated below:
|S.No .||Circumstances of refund||Relevant date|
|1.||Export rebate on final products or on the e materials used in their manufacture-
i ) Export by Sea or air
ii) Export by land
iii) Export by post
|Date of shipment
Date on which goods pass the frontier
Date of dispatch by post office
|2.||Goods returned for being remade etc. (Rule 173L)||Date of entry into the factory|
|3.||Where refund is claimed by a person other the than the manufacturer||Date of purchase of goods by such Person|
|4.||Refund on the basis of an ad-hoc exemption order under section 5A(2)||Date of issue of the order|
|5.||Any other case||Date of payment of duty|
The time limit of 6 months is however, not applicable where the duty is paid under protest in terms of Rule 233B of the Central Excise Rules, 1944.
Where the burden of duty has been transferred by the manufacturer to the buyer, the refund of duty to the manufacturer would lead to his unjust enrichment. The law does not permit such unjust enrichments. In such cases the refundable amount is credited to the consumer welfare fund. The burden of proof that the incidence of duty has not been passed on to the customer is on the manufacturer. However, in case of rebate of duty in the cases of exports, refund of unspent deposits lying in the PLA and the refund of credit of duty in terms of Rule 57F(13), the doctrine of unjust enrichment does not apply.