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2010 (2) TMI 1239 - AT - Central Excise
Issues involved:
The issues involved in the judgment are the recovery of amounts u/s 11D, 11A, and interest under 11AB of the Central Excise Act, 1944, the permissibility of using Cenvat credit for such recoveries, and the applicability of penalty and interest in relation to the recovery process. Recovery under Section 11D: The learned Commissioner (Appeals) concluded that certain amounts were recoverable u/s 11D of the Central Excise Act, 1944. Subsequently, a show-cause notice was issued to the assessee for recovery of a specific amount under Section 11D. The adjudication resulted in a decision for the recovery of the specified amount through cash or PLA account, without imposing interest or penalty on the assessee. Use of Cenvat credit for payment under Section 11D: The Appellate Authority held that Cenvat credit cannot be utilized for payment under Section 11D of the Act. The appellant contested this decision, arguing that the recovery made through the Cenvat credit account was proper and should not require additional cash payment. The appellant emphasized that recovery under Section 11D should be considered as duty, as per the provisions of the statute. Appellate Tribunal's Decision: The appellant appealed the first appellate order, maintaining that the recovery through Cenvat credit was valid. The Tribunal considered the arguments presented by both sides and examined the record. It was noted that the recovery under Section 11D is distinct from duty liability and should not be discharged through the Cenvat credit scheme. The Tribunal dismissed the appeal, affirming that the recovery through the Cenvat credit account was not permissible. Conclusion: The Tribunal upheld the decision that recovery under Section 11D of the Central Excise Act, 1944 cannot be made through Cenvat credit. The judgment emphasized that the recovery under Section 11D is not akin to duty liability and should be deposited in cash or adjusted through PLA account. The Tribunal highlighted the specific provisions of Section 11D aimed at preventing unjust enrichment and clarified that such recovery does not fall under the purview of the Cenvat credit scheme.
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