2009 (12) TMI 764 - AT - Central Excise

Adjustment of excess duty paid by the appellant against the short duty paid by them - provisional assessment u/r 7 of the CER 2002 - Held that - Since there are contrary views taken by the very same Bench on the applicability of Rule 7 of the Central Excise Rules 2002 on the adjustment of excess payment of duty towards short payment of duty on finalization of provisional assessment we are of considered view that the issue needs to be resolved by a Larger Bench - issue to be resolved by Larger Bench.

Summary

Issues:
Adjustment of excess duty paid against short duty paid in provisional assessment under Rule 7 of the Central Excise Rules, 2002.

Analysis:
The Tribunal considered the issue of adjustment of excess duty paid against short duty paid by the appellant in respect of provisional assessment under Rule 7 of the Central Excise Rules, 2002. The Adjudicating Authority had confirmed a demand of the differential duty, rejecting the appellant's claim for adjustment of excess duty paid. The appellant relied on the decision in the case of Goetze (I) Ltd. v. CCE, Bangalore, while the Departmental Representative cited the decision in RPG Cables Ltd. v. CCE, Mysore. The Tribunal noted conflicting views in these cases regarding the adjustment of excess payment against short payment and the applicability of Rule 7.

In the case of RPG Cables Ltd., the Tribunal held that excess payment entitles the assessee to a refund, subject to unjust enrichment. However, in the case of Goetze (I) Ltd., the Tribunal emphasized that the Revenue should adjust the duty paid or short paid, and the confirmation of demand was deemed incorrect. The Tribunal acknowledged the contradictory views taken by the same Bench on the interpretation of Rule 7 and the adjustment of duty payments in finalizing provisional assessments.

Due to the conflicting decisions and the need for clarity on the application of Rule 7 in such scenarios, the Tribunal decided that the issue required resolution by a Larger Bench. The files were directed to be placed before the Hon'ble President for further consideration. The Tribunal's order was pronounced at the conclusion of the hearing, highlighting the need for a definitive decision on the adjustment of excess duty paid against short duty paid in provisional assessments under Rule 7 of the Central Excise Rules, 2002.