M/S. Steel Authority Of India Ltd vs Cce-Raipur

[Arising out of Order- in-original No. 11/COMMR(Adj)/RPR/2005 dated 30.1.2006 passed by CCE-Raipur]

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

2. Whether it would 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 of the order?

4. Whether order is to be circulated to the Department Authorities?

M/s. Steel Authority of India Ltd. Appellant

Vs.

CCE-Raipur Respondent

Appearance: Shri Amit Jain, Advocate for the appellant

Shri Pramod Kumar, JCDR for the respondent.

Coram: Honble Shri Ashok Jindal, Member (Judicial)

Honble Shri B.Ravichandran, Member (Technical)

Final Order No. 52383/2015

Per: Ashok Jindal

The appellant is in appeal against the demand of duty of Rs. 90,16,000/- and the penalty of Rs. 5 lakh.

2. The facts of the case are that the demand of duty of Rs. 1,12,29,422/- was confirmed by order dated 31/10/1988 against the appellant. The said order of demand was challenged by the appellant before this Tribunal. While granting stay, the appellant was directed to make a pre-deposit of the whole of the demand confirmed by order dated 31/10/2006. Later on vide order dated 5/6/1997, this Tribunal set aside the order confirming the demand dated 31/10/1998. Consequent to the order of this Tribunal, the appellant moved an application for refund of the amount of pre-deposit on 2/8/1997. No consideration of the refund claim was considered by the department but vide order dated 12/10/2001, the amount of refund was sanctioned and adjusted against the other demands pending against the appellant. The appellant challenged the said order before the ld. Commissioner (appeal) who hold that the adjustment against the outstanding demand is not proper, therefore, they are entitled for refund claim along with interest vide order dated 10/07/2003. This order was not challenged by the department. On 11/8/2003, the appellant written to the concerned authority for sanctioning the refund but refund was not given to the appellant.

Therefore, on 1/09/2003 appellant took suo-motu credit of the amount of Rs. 1,12,29,422/- and also proceed for claim of interest with the department vide letter dated 10/05/2004, as no reply was given by the department, therefore, on 01/07/2004, the appellant intimated to the department that out of total interest of Rs. 90,16,303/-, appellant has taken suo-motu credit of interest of Rs. 90,16,000/-. On realization that appellant has taken excess credit of interest, the appellant on 1/12/2004 reverse the excess credit taken by them of Rs. 7,87,070/-. The reversal of excess credit of interest was intimated to the department on 31/01/2005. Thereafter, on 23/08/2005, a show cause notice was issued to the appellant to deny the suo-motu credit of interest taken by the appellant on 01/07/2004. Alleging that as the appellant is not entitled to take suo-moto credit of interest, therefore, utilization of that suo-moto credit amounts to clearance of goods without payment of duty. Therefore, duty of Rs. 90,16,000/- was confirmed against the appellant and a penalty of Rs. 5 lakh was also imposed on them.

Thereafter, on 6/11/2006, the interest of Rs. 82,28,930/- was sanctioned to the appellant. Aggrieved from the order of confirming of demand of duty of Rs. 90,16,000/- and imposition of penalty of Rs. 5 lakh appellant is before us.

3. Heard the parties.

4. Considering the facts that the appellant was entitled for refund after three months from the order of passing by this Tribunal on 5/6/1997 and on repeated reminders filed by the appellant, no steps has been taken by the department for sanctioning the refund claim as well as interest. In these circumstances, although after initiation of the impugned proceedings, interest is sanctioned to the appellant. Therefore, the suo-motu credit interest taken by the appellant is stand corrected.

5. In result, no demand of duty is pending against the appellant as on date.

6. With regard to the penalty, we hold that as there was no mensrea to take suo-moto credit, we drop the penalty imposed on the appellant in utilization of credit of interest of Rs. 90,16,000/-. Consequently, appeal is allowed.

(Ashok Jindal)

Member (Judicial)

(B. Ravichandran)

Member (Technical)

Ritu