2008 (11) TMI 521 - AT - Central Excise

Summary

Issues: Dispute over interest demand arising from supplementary bills raised subsequently in terms of a contract with a price variation clause.

In this judgment by the Appellate Tribunal CESTAT, New Delhi, the appellant raised supplementary bills based on a contract clause allowing price variation, leading to a dispute over interest demand. The appellant argued that both parties agreed to the contract terms, and the Excise Authorities were aware of the situation, thus no interest should be levied. The appellant also highlighted that a similar issue was pending before a Five Member Bench. The Revenue contended that they had a favorable case, and the law favored them, emphasizing that mere pendency before a Five Member Bench did not automatically grant a stay on demand realization. The Tribunal analyzed the situation, noting that the pricing variation was a result of agreed terms between the parties, and the appellant had the right to re-settle bills due to time playing a role in price settlement. The Tribunal considered that the known rights of the parties should have been settled promptly to avoid interest liability. Acknowledging the pending issue before the Five Member Bench, the Tribunal decided in favor of the appellant, granting a stay on demand realization during the appeal's pendency. Additionally, the Revenue was directed to seek early disposal of the matter by the Five Member Bench. The dispensation of pre-deposit was ordered until the appeal's final disposal, providing leniency to the appellant in this situation.