2007 (7) TMI 532 - AT - Central Excise

Summary

Issues: Department's appeal against Commissioner (Appeals) order for refund under compounded levy scheme.

In this case, the Department filed an appeal against the order of the Commissioner (Appeals) regarding the refund under a compounded levy scheme. The respondent company was operating under the compounded levy scheme, paying duty based on APC fixed. The duty paid did not directly correlate with actual clearances made by the company. Disputes arose regarding the amount payable under the scheme, leading to a claim for a refund. The Original Authority disallowed part of the refund, citing it was obtained as a rebate for exported goods. The Commissioner (Appeals) allowed the party's appeal, ordering a refund of Rs. 51,382, leading to the Department's appeal.

Upon hearing both sides, the Tribunal considered that duty under the compounded levy scheme is not linked to actual production and clearances, and export incentives are paid based on a formula. The Tribunal noted that the change in duty paid under the scheme does not affect the rate fixed for export incentives. The Tribunal upheld the Commissioner (Appeals)'s decision, stating that the rebate taken by the company does not impact the duty payable under the compounded levy scheme. The Tribunal found no valid reasons to interfere with the decision, leading to the dismissal of the Department's appeal.

In conclusion, the Tribunal's judgment clarified that the duty paid under the compounded levy scheme and the export incentives are separate aspects. The decision emphasized that the rebate obtained by the company for exported goods does not influence the duty payable under the scheme. The judgment provides a clear interpretation of the legal principles governing the refund under the compounded levy scheme, ensuring consistency and adherence to the prescribed regulations.