Commissioner Of Central Excise, ... vs M/S.Guwahati Carbon Ltd

(Arising out of Order-in-Appeal No.52/GHY/CE(A)/GHY/11 dated 30.08.2011 passed by the Commissioner(Appeals) of Customs & Central Excise, Guwahati.)

FOR APPROVAL AND SIGNATURE

HONBLE DR. D.M. MISRA, MEMBER(JUDICIAL) HONBLE DR. I.P. LAL, MEMBER(TECHNICAL)

1. Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?

2. Whether it should be released under Rule 27 of the CESTAT(Procedure) Rules, 1982 for publication in any Authorative report or not?

3. Whether Their Lordship wishes to see the fair copy of the Order?

4. Whether Order is to be circulated to the Departmental Authorities?

Commissioner of Central Excise, Guwhati Applicant (s)/Appellant (s)

Vs.

M/s.Guwahati Carbon Ltd. Respondent (s)

Appearance:

Shri A.K.Biswas, Supdt.(A.R.) for the Revenue

Shri B.N.Pal, Advocate for the Respondent

CORAM:

Honble Dr. D.M. Misra, Member(Judicial) Honble Dr. I.P. Lal, Member(Technical)

Date of Hearing:- 13.05.2015 Date of Pronouncement :- 13.05.2015

ORDER NO.FO/A/75257/15

Per Dr. D.M. Misra.

1. This is an application filed by the revenue seeking stay of the order-in-appeal No. 52/GHY/CE(A)/GHY/11 dated 30.08.2011. It is the contention of the ld.A.R.(Commissioner) for the Revenue that the ld.Commissioner has outrightly sanctioned the refund of interest amount of Rs.46,91,870/-. It is his submission that while recording reasons the ld.Commissioner(Appeals) had observed that while adjusting the interest amount against the sanctioned refund, no show cause notice was issued to the assessee, thus the interest deducted ought to be sanctioned as refund to the assessee. It is his submission that even though there could be requirement for issue of notice before deduction of the interest due to the government on account of outstanding liability, but that cannot wipe out the liability of the assessee to pay to the Government dues. He has no objection in remanding the case to the adjudicating authority for issuance of notice.

2. The ld.Advocate for the respondent assessee submitted that interest deducted from the refund amount is bad in law. However, he has no objection in remanding the case to the adjudicating authority.

3. After hearing both sides for some time we take up the appeal for disposal instead of deciding the stay application filed by the Revenue.

4. We find that the adjudicating authority vide order dated 06.12.2010 recorded the reasons for recovery of interest of Rs.45,33,433/- and adjusted the said interest against the sanctioned refund of Rs.71,36,592/-. The ld.Commissioner(Appeals) while disagreeing with the said order observed that before quantifying the interest and adjusting against the refund, the assessee ought to have been issued with a show cause notice. We find merit in the observation of the ld.Commissioner(Appeals). However, non-issuance of show cause notice, in our opinion cannot wipe out the liability to pay interest, if any, cast on the assessee. Therefore, in the interest of justice the matter is remitted to the original authority to crystallize the interest liability after observing the principles of natural justice. Both sides are at liberty to file evidences in their favour. Needless to mention a reasonable opportunity be granted to the respondent assessee. Appeal allowed by way of remand. Stay petition disposed of.

(Pronounced and dictated in the open court.)

SD/ SD/

(I.P.LAL) (D.M.MISRA) MEMBER(TECHNICAL) MEMBER(JUDICIAL) sm

3 Appeal No. Ex.Ap.970/11