2008 (12) TMI 613 - AT - Central Excise

Summary

Issues:
1. Admissibility of deductions claimed by the appellants based on price list filed under Part-VII.
2. Eligibility of the appellants to file the price list under Part-VII.
3. Adjustment of amount payable against the amount refundable due to inadvertent addition of Modvat credit on inputs.
4. Finalization of provisional assessment and treatment of duty payable and refundable amounts.

Analysis:

Issue 1: Admissibility of deductions claimed by the appellants
The appellants filed a price list under Part-VII for their products, claiming deductions on various accounts such as godown rent, transportation, octroi, and turnover tax. The dispute arose regarding the admissibility of these deductions and whether the appellants were eligible to file the price list under Part-VII. The original adjudicating authority allowed the deductions claimed by the appellants at different stages, leading to a conclusion that they are eligible for a refund of Rs. 1,94,66,427.

Issue 2: Eligibility to file the price list under Part-VII
The Commissioner (Appeals) held that the amount payable by the appellant cannot be adjusted against the amount refundable due to an inadvertent addition of Modvat credit on inputs. The appellants challenged this decision, arguing that both the demand and the refund were determined based on goods cleared during a specific period and were not different transactions. They contended that the assessment was provisional and Rule 9(B) allows adjustment for excess payment against the duty payable.

Issue 3: Adjustment of amount payable against the amount refundable
The appellants argued that the demand for Rs. 89,68,771 should not be adjusted against the refund as both amounts arose from the same transactions. The Superintendent of Central Excise concluded that the case should be treated as provisional assessment, and the amount payable should be adjusted against the refund due to the appellants. The Tribunal agreed with this view and set aside the impugned order, providing consequential relief to the appellants.

Issue 4: Finalization of provisional assessment
The Tribunal observed that various deductions claimed by the appellants were disputed, leading to the RT-12 returns not being finalized. The Assistant Commissioner's order in April 1993 concluded that prices were considered approved in Part-I instead of Part-VII. The Superintendent of Central Excise assessed the RT-2 returns giving deductions on an actual basis, treating the case as provisional assessment. The Tribunal agreed that the liability and refund should not be treated separately as they arise from the same transaction.

In conclusion, the Tribunal found in favor of the appellants, allowing the adjustment of the amount payable against the refund due to them, based on the provisional assessment and the nature of the transactions involved.