2008 (1) TMI 783 - AT - Central Excise

Summary

Issues:
1. Erroneous payment of duty without protest.
2. Requirement of show cause notice under Section 11A of the Central Excise Act.
3. Applicability of Rule 57S of the Central Excise Rules, 1944.
4. Admissibility of refund claim.

Analysis:

1. The appellants cleared two machines without paying duty, which was later detected by the Central Excise Audit Party. The appellants paid duty against the invoices and filed a refund claim, stating that the duty was paid erroneously. The main contention was that the amount was deposited erroneously at the instance of the Audit party, and they were entitled to depreciation under Rule 57S of the Central Excise Rules, 1944. However, the Tribunal found that the duty was deposited without any protest, and thus, the contention of the appellant was not sustainable.

2. The appellant argued that a show cause notice under Section 11A of the Central Excise Act was required for the payment of duty. The Tribunal observed that since the duty was deposited voluntarily without protest, there was no requirement for a show cause notice under Section 11A. The Revenue issued a show cause notice for the rejection of the refund claim, and the Tribunal upheld this decision, stating that the payment of duty was legal and proper.

3. The appellant strongly relied on Rule 57S of the Central Excise Rules, 1944, for claiming depreciation on the duty paid. However, the Tribunal noted that Rule 57S was not in force at the time the goods were cleared. The relevant provisions applicable at the time of clearance were Rule 57AB(1) of the Central Excise Rules, 1944, and Rule 3(4) of the Cenvat Credit Rules, 2001. The Tribunal concluded that the duty was correctly discharged based on the invoice value of the goods, and there was no need to determine any depreciated value for that purpose.

4. The Tribunal considered the appellant's argument that the demand of duty was barred by limitation as the goods were cleared under specific invoices. However, the Tribunal found that the duty was deposited voluntarily by the appellant to avoid penalty, and there was no violation of principles of natural justice. Therefore, the Tribunal rejected the appeal, upholding the decision of the Commissioner (Appeals) to reject the refund claim.

In conclusion, the Tribunal dismissed the appeal, emphasizing that the duty was deposited voluntarily without protest, and the appellant's reliance on Rule 57S was not valid as it was not in force at the time of clearance. The Tribunal found no reason to interfere with the decision of the Commissioner (Appeals) and upheld the legality of the duty payment.