By TIOL News Service

MUMBAI, MAR 28, 2018: THE appellant merged with another company in terms of the Bombay High Court order.

They, therefore, applied for transfer of the amount lying unutilized in their PLA account.

Such request was not entertained by the department and no orders were passed in this regard.

Thereafter, the appellant applied for refund of the amount lying unutilized in the PLA account.

This claim was rejected by Revenue by observing that the said amount is "duty waiting to be debited" and the limitation as provided u/s 11B of CEA, 1944 would apply.

The appellant is before the CESTAT.

After considering the submissions, the Bench observed thus –

+ The limitation prescribed under section 11B applies to the refund of "duty" amount.

+ Inasmuch as the lower authorities themselves observed that the amount in question is "duty waiting to be debited", this clearly shows that the same is not duty, in which case, the provision of section 11B would not apply.

+ Otherwise also, the PLA deposits are mere deposits for the purposes of their utilization in the future and if the same is not in a position to be utilized, the depositor has to be held as owner of the said amount which is required to be refunded to them, in the absence of any limitation prescribed under the Act for such refund.

The impugned order was set aside and the appeal was allowed with consequential relief.

(See 2018-TIOL-979-CESTAT-MUM)