2016 (3) TMI 1166 - AT - Central Excise

Refund claim - exemption under N/N. 56/2002-C.E., dated 14-11-2002 - refund claim were sanctioned by adjudicating authority on merits holding that the SCN issued to the appellant have not confirmed demand against the appellant therefore, the amount in dispute as per the SCN cannot be adjusted against the refund claim - Held that - the ld. Commissioner (Appeals) had fallen in an error by adjusting the amount in dispute as per SCN. As demand against the appellant is in dispute therefore, unless and until the dispute is settled, it cannot be deemed as confirmed demand therefore, the ld. Commissioner (Appeals) has not interpreted the law in true spirits - the refund claim was pending with the adjudicating authority but in this case refund claim has been already sanctioned to the appellant - appeal allowed - decided in favor of appellant.

Summary

Issues:
Adjustment of refund claim against pending show cause notices.

The appellant filed a refund claim under Notification No. 56/2002-C.E., dated 14-11-2002, which was sanctioned by the adjudicating authority. The show cause notices issued to the appellant did not confirm any demand against them. The revenue challenged this decision before the ld. Commissioner (Appeals), who adjusted the amount in dispute as per the show cause notices against the refund claim. The appellant appealed this decision. The Tribunal noted that the amount of dispute as per the show cause notices had not been adjudicated, indicating no pending demand against the appellant. The Tribunal held that the Commissioner had erred in adjusting the amount in dispute, as there was no confirmed demand against the appellant until the dispute was settled. The Tribunal found that the Commissioner's reliance on an interim order from the High Court of Jammu & Kashmir was misplaced, as it did not apply to the facts of this case where the refund claim had already been sanctioned. Consequently, the Tribunal set aside the impugned order, allowing the appeal with any consequential relief.

In conclusion, the Tribunal held that the adjustment of the refund claim against pending show cause notices was not valid in this case. The Tribunal emphasized that without the adjudication of the amount in dispute, there was no confirmed demand against the appellant. The Tribunal also clarified that the interim order from the High Court of Jammu & Kashmir cited by the Commissioner was irrelevant to the circumstances of this case. Therefore, the impugned order was set aside, and the appeal was allowed with any necessary relief.