2007 (4) TMI 450 - AT - Central Excise

Summary

Issues:
- Alleged contravention of provisions of section 11D of Central Excise Act, 1944 by the respondents.
- Interpretation of duty recovery and payment requirements for exported goods.
- Application of section 11D in cases of duty recovery discrepancies.
- Assessment of duty liability on the merchant exporter.

Analysis:
1. Alleged Contravention of Section 11D:
The appeal filed by the Revenue alleged that the respondents contravened section 11D by collecting an amount in excess of the excise duty assessed on sugar cleared for export. The original authority confirmed the demand, but the Commissioner (Appeals) dropped it, stating that since the sugar was exported based on a CT-1 Certificate, no duty payment was required. The absence of duty recovery evidence on invoices led to the dismissal of the demand.

2. Interpretation of Duty Recovery for Exported Goods:
The Revenue argued that the accountant's statement, supported by invoice details showing a specific excise duty rate, indicated duty recovery from the merchant exporter. It was emphasized that even though duty liability rested with the exporter, the respondents were obligated to credit the amount to the Central Government under section 11D. However, the Tribunal found no evidence of duty recovery as representing duty on the invoices, leading to the rejection of the Revenue's appeal.

3. Application of Section 11D and Duty Liability:
The Tribunal noted that the duty rate on the invoice was for quantifying purposes in case of non-export, with the duty being recoverable from the exporter. It was observed that the duty confirmed against the exporter was also collected from the respondents. Therefore, demanding the same amount from the respondents under section 11D contradicted the duty recovery process. As a result, the Tribunal dismissed the Revenue's appeal, finding no merit in the demand for duty recovery from the respondents.

In conclusion, the judgment clarified the duty recovery and payment requirements for exported goods under section 11D of the Central Excise Act, emphasizing the necessity of clear evidence of duty recovery on invoices. The decision highlighted the importance of proper documentation and adherence to legal provisions in determining duty liabilities for exporters and manufacturers involved in the export process.