2016 (12) TMI 922 - AT - Central Excise

Cenvat credit - Penalty - amount which was paid in excess on removal of inputs as such under Rule 57F(3) of Central Excise Rules, 1944 - Held that - it is very clear that the show cause notice can be issued only in respect of duty short-paid or not paid - This is not a case where there is any short-payment or non-payment of duty. Therefore, excess paid duty cannot be again recovered under the provisions of Section 11A - Appeal allowed - decided in favor of the assessee.

Summary

Issues:
1. Excess duty payment under Rule 57F(3) of Central Excise Rules, 1944.
2. Interpretation of Section 11A of Central Excise Act, 1944 regarding duty recovery.

Analysis:

Issue 1: Excess duty payment under Rule 57F(3) of Central Excise Rules, 1944
The case involved the appellant paying excise duty on inputs under Rule 57F(3) of Central Excise Rules 1944, resulting in excess duty payment. The adjudicating authority confirmed a demand and imposed a penalty. The appellant appealed, arguing that there was no bar for paying duty in excess, as long as it was not less than the MODVAT credit availed. The appellant cited a previous case where a similar issue was resolved in their favor. The Asstt. Commissioner for Revenue reiterated the findings of the impugned order. The Tribunal noted that the demand was confirmed based on the excess duty paid under Rule 57F(3).

Issue 2: Interpretation of Section 11A of Central Excise Act, 1944 regarding duty recovery
The Tribunal examined the applicability of Section 11A, which pertains to recovery of duties not levied or paid, short-levied, or erroneously refunded. The section allows for a show cause notice in cases of duty not paid or short-paid. In this case, it was established that the duty was paid in excess, not short-paid or unpaid. Therefore, the Tribunal concluded that Section 11A could not be invoked for recovering excess duty. Additionally, the Tribunal considered the previous decision by the Commissioner (Appeals) in favor of the appellant on a similar issue, where no appeal was filed against that decision. Consequently, the Tribunal set aside the impugned order and allowed the appeals.

In conclusion, the Tribunal ruled that excess duty payment under Rule 57F(3) did not warrant recovery under Section 11A of the Central Excise Act, 1944, as it pertained to cases of short-paid or unpaid duty. The decision was based on the specific provisions of the law and previous favorable rulings in similar cases.