M/S. Laxmi Co-Operative Processors Ltd vs Commissioner, Central Excise, ...

[Arising out of Order-in- Appeal No. PII/BKS/70/2007 dtd. 3/5/2007 passed by the Commissioner(Appeals) Central Excise, Pune-II]

For approval and signature:

Honble Mr Ramesh Nair, Member(Judicial)

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1. Whether Press Reporters may be allowed to see : No 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 authoritative report or not?

3. Whether Their Lordships wish to see the fair copy : seen of the Order?

4. Whether Order is to be circulated to the Departmental: Yes authorities? =======================================================

M/s. Laxmi Co-Operative Processors Ltd. : Appellants

VS

Commissioner, Central Excise, Ichalkaranji Divn. Miraj : Respondent

Appearance

None for the Appellants Shri. Ashitosh Nath, Asstt. Commissioner(A.R.) for the Respondent

CORAM:

Honble Mr. Ramesh Nair, Member (Judicial)

Date of hearing: 27/5/2015 Date of decision: 27/5/2015

ORDER NO.

Per : Ramesh Nair

This appeal is directed against Order-in- Appeal No. PII/BKS/70/2007 dtd. 3/5/2007 passed by the Commissioner(Appeals) Central Excise, Pune-II, wherein Ld. Commissioner(Appeals) rejected the appeal of the appellant.

2. The fact of the case is that the appellant deposited Rs. 15 lakhs during the investigation of the case against M/s. Quality Processors. Show cause notice for demand vide No. DGCEI/MZU/I & ISA/12(4) 68/2005/3255 dated 5/4/2006 was issued to M/s. Quality Processors, C/o. M/s. Laxmi Co-operative Processors Ltd., Ward No. 11/409, Station Road, Ichalkaranji and five other parties. In the said show cause notice it was also proposed to appropriate the amount of Rs. 15 lakhs paid by the appellant vide TR6 Challan No.01/31.10/2005 against Central Excise duty(determined to be payable). Subsequently the appellant filed refund claim on the ground that since they were not issued show cause notice, this amount of Rs. 15 lakhs paid by them becomes refundable. The adjudicating authority rejected the claim on the ground that in the show cause notice issued to M/s. Quality Processors, one of the proposal was to appropriate the said amount of Rs. 15 lakhs towards duty liability against M/s. Quality Processors and until said show cause notice is decided refund cannot be sanctioned. Aggrieved by the said order, the appellant filed appeal before the Commissioner(Appeals), who rejected the appeal upholding the findings of the lower adjudicating authority therefore the appellant is before me.

3. When the matter was called for hearing, none appeared on behalf of the appellant nor there is any adjournment request on record therefore I proceed to decide the matter on merit.

4. Shri. Ashitosh Nath, Ld. Asstt. Commissioner(A.R.) appearing on behalf of the Revenue reiterates the findings of the impugned order. He further submits that even though no show cause notice was issued to the appellant but since the deposit of Rs. 15 lakhs made by them was proposed to be appropriated in show cause notice dated 5/4/2006 issued to M/s. Quality Processors, refund of the said amount cannot be processed unless until the show cause notice is decided and demand is dropped. He submits that not only in show cause notice there was a proposal of appropriation of amount, but also appellant vide their letter dated 20/3/2006 addressed to Additional Director, DGCEI had categorically stated that amount of Rs. 15 lakhs deposited by them may not be refunded but the same may be adjusted against the short payment of the duty by M/s. Quality Processors ; that the account of M/s. Quality Processors shall be debited for Rs. 15 lakhs in M/s. Laxmi Co-operative Processors Ltds account. It is his submission that with the above fact the adjudicating authority has not processed the refund claim unless until proceedings of show caused notice dated 5/4/2006 is concluded. Accordingly both the lower authorities are correct in rejecting the refund claim.

5. I have carefully considered the submission made by Ld. A.R. and perused the record.

6. The facts narrated above are not in dispute. Since the deposit of Rs. 15 lakhs was proposed to be appropriated in the show cause notice dated 5/4/2006 issued by DGCEI to M/s. Quality Processors therefore unless until show cause notice is finally decided, refund claim is not mature. I also observe that appellant themselves have proposed for adjustment of this Rs. 15 lakhs against short payment of duty by M/s. Quality Processors. In such a situation, I agree with the lower authorities that the refund cannot be granted at this stage. Information regarding the status of the proceedings of show cause notice dated 5/4/2006 is not available on record before me. In view of the above position, I remand the matter to the original adjudicating authority with a direction that refund claim of Rs. 15 lakhs filed by the appellant should be processed in accordance with law after conclusion of proceedings covered under the show cause notice dated 5/4/2006. The matter is remanded in the above terms.

(Dictated in court)

Ramesh Nair Member (Judicial) sk

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