2006 (7) TMI 416 - AT - Central Excise

Summary

Issues:
Appeal against order allowing refund claim due to unquantified redemption fine and improper appropriation of bank guarantee by adjudicating authority.

Analysis:
The appeal before the Appellate Tribunal CESTAT, New Delhi challenged the order-in-appeal dated 12-7-04, where the Commissioner (Appeals) had granted a refund to the respondents. The Tribunal considered the submissions from both sides and reviewed the records. It was noted that there was a confiscation of excess goods found in the factory premises of the respondents by the adjudicating authority. The goods were confiscated without a specific amount being mentioned for redemption fine; instead, the authority appropriated the bank guarantee provided by the respondents. Additionally, a penalty was imposed on the respondent, who later availed relief under the KVSS Scheme for the penalty amount. The respondent's advocate argued that had the redemption fine been quantified, they would have included it in the KVSS Scheme as well.

The Tribunal acknowledged the argument presented by the respondent's advocate, emphasizing the principle that recovery without quantification is improper. It was observed that the appropriation of the bank guarantee by the adjudicating authority, without specifying the amount, was not in accordance with the law. Therefore, the Commissioner (Appeals) correctly allowed the refund that had been appropriated against an unquantified amount. Considering the facts and circumstances of the case, the Tribunal found no justification to interfere with the impugned order. Consequently, the appeal filed by the department was dismissed.

The judgment was delivered on 25-7-06, affirming the decision to uphold the refund claim and highlighting the importance of quantifying amounts for proper recovery procedures in such cases.