M/S. Kec International Ltd vs C.C.E., Jaipur-I
- CitationAppeal No. E/53267/2014-EX[SM]
Ratio decidendi
The rule this decision rests on
Where a demand has been confirmed in adjudication but its recovery has been stayed by the appellate authority upon compliance with the condition of pre-deposit, the confirmed amount is not a payable arrear of Government dues during the pendency of the appeal, and it cannot be adjusted against a sanctioned refund claim. Section 11B of the Central Excise Act, 1944 contains no specific restriction permitting the adjustment of arrear dues from a sanctioned refund, and a refund sanctioned under Section 11B(2) cannot be reduced by such adjustment in the absence of that restriction. The statutory provisions for recovery of Government dues are contained in Section 11 of the Central Excise Act, 1944; where the adjudication order has not invoked Section 11 for the purpose of adjusting the refund against arrear dues, such adjustment is contrary to the statutory provisions.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
1. Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No 2. Whether it would be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? Yes 3. Whether Lordships wish to see the fair copy of the order? Seen 4. Whether order is to be circulated to the Department Authorities? Yes
Appeal No. E/53267/2014-EX[SM]
[Arising out of Order-in-Appeal No.35(VC)CE/JPR-I/2014, dated 14.03.2014 passed by the C.C.E.(Appeals), Jaipur-I]
M/s. KEC International Ltd. Appellant
Vs.
C.C.E., Jaipur-I Respondent
Appearance
Mr. Alok Kothari Authorised Rep. - For Appellant
Mr. G.R. Singh, DR - For Respondent
CORAM: Honble Mr. S.K. Mohanty, Member (Judicial)
Final Order No.___54131/2015______, dated 14.05.2015
Per Mr. S.K. Mohanty :
The issue involved in this case relates to adjustment of refund claim towards the arrear of Govt. dues, adjudicated as payable by the appellant, in the previous occasions.
2. The brief facts of the case are that a refund claim of Rs.30,43,763/- filed the appellant was allowed by the original authority, out of which an amount of Rs.15,07,902/- was adjusted from the sanctioned amount towards pending arrear dues and balance amount of Rs.15,35,861/- was refunded to the appellant. In appeal against the adjudication order, the Commissioner (Appeals) has upheld the adjustment of the refund amount towards the arrear dues. Hence the present appeal is before this Tribunal.
3. Shri Alok Kothari, the authorised representative for the appellant submits that the demand confirmed against the adjudication order dated 23.10.2012 was appealed against by the appellant before the Commissioner (Appeals) along with petition for stay of realisation of the adjudged demand. The stay application was disposed of by the Commissioner (Appeals) vide order dated 12.02.2014, directing the appellant to deposit Rs.2,50,000/- as a condition of pre-deposit and granted stay of recovery of penalty during pendency of the appeal. Since the stay application has been complied with by the appellant, the balance dues arising out of the adjudication order is not payable, during the pendency of the appeal before the Commissioner (Appeals). Thus, he submits that the amount confirmed vide order dated 23.10.2012 cannot be considered as arrear of Govt. dues and the same cannot be adjusted against the sanctioned amount of refund.
4. On the other hand, Shri G.R. Singh, ld. Departmental Representative reiterated the findings recorded in the impugned order.
5. Heard both the parties and perused the records.
6. I find that the central excise demand of Rs.4,88,411/- and equal amount of penalty confirmed in the adjudication order dated 23.10.2012 was stayed by the Commissioner (Appeals) vide order dated 12.02.2012, upon compliance of the condition of pre-deposit by the appellant. Since the balance amount arising out of the adjudication order has been stayed by the Commissioner (Appeals), till the decision in the appeal, I do not find any merits in adjusting the entire amount from the refund claim filed by the appellant.
7. Section 11B of Central Excise Act, 1944 deals with claim for refund of central excise duty. In sub-section (2) of Section 11B, it has been provided that if the refund sanctioning authority is satisfied that the refund is allowable, then the amount of refund shall be sanctioned to the applicant. Since there is no specific restriction imposed in Section 11B of the Act for adjustment of any arrear dues from the refund amount, the same cannot be adjusted by the statutory authority.
8. The provisions for recovery of Govt. dues are contained in Section 11 of the Central Excise Act, 1944. In the adjudication order, Section 11 of the Act has not been invoked for adjustment of the refund amount towards arrear dues. Thus, such adjustment is contrary to the statutory provisions.
9. In the light of the above analysis, I do not find any merits in the impugned order. Therefore, the appeal filed by the appellant is allowed.
[Operative portion pronounced in the open court]
(S.K. Mohanty)
Member (Judicial)
SSK
-2-
This page reproduces a public judgment and a summary of it. It is research material, not legal advice, and it is no substitute for advice from an advocate on your own facts.
Research this judgment with Miss Lucy
Ask what it holds, what has followed it, and what it means for your matter — in plain English, with the citations.
Try Miss Lucy free