2008 (4) TMI 548 - AT - Central Excise

Summary

Issues involved: The judgment involves the recovery of excise duty, adjustment of short-paid duty against excess paid duty, and the application for waiver and stay.

Recovery of Excise Duty: The appellant's appeal was against the order directing the recovery of Rs. 6,26,782/- with interest u/s 11A and 11AB of the Central Excise Act, read with Rule 7 of the Central Excise Rules, 2002. The appellant was required to pre-deposit the said amount as per Section 35F of the Act. The case involved provisional assessment, finalization of assessment, short-paid excise duty, excess paid excise duty, and the order for recovery of the amount. The Commissioner (Appeals) upheld the recovery of Rs. 6,26,782/- with interest under the relevant provisions of the Central Excise Act and Rules.

Adjustment of Short-Paid Duty Against Excess Paid Duty: The key issue was whether the outstanding dues of short-paid duty could be adjusted against the excess paid duty amount. The appellant's counsel focused on this issue for the purpose of stay. Rule 7 of the Central Excise Rules, 2002 allows for provisional assessment and refund in certain cases. The Tribunal noted that the adjustment of excess duty paid with short-paid duty is not allowable without determining the aspect of 'unjust enrichment.' The Tribunal relied on a decision of the Bombay High Court and emphasized that refund can only be made if the incidence of duty has not been passed on. The Tribunal found no prima facie case in favor of the appellant for such adjustment. The appellant was directed to deposit a specified amount within a given timeframe, upon which the pre-deposit of the balance amount of duty and interest would be waived, and recovery stayed.

Compliance and Conclusion: The appellant was directed to deposit a specified sum within a set period, failing which the recovery of the remaining amount would proceed. The judgment also noted the tagging of the appeal with another related case. The appellant was required to report compliance by a specified date.

This summary provides a detailed overview of the issues involved in the judgment, the arguments presented, and the Tribunal's decision regarding the recovery of excise duty and the adjustment of short-paid duty against excess paid duty.