2019 (4) TMI 20 - AT - Central Excise

Recovery of outstanding dues - adjustment of rebate (refund) claim - export of goods - Section 11 of the Central Excise Act, 1944 read with Section 142 of the Customs Act, 1962 - Held that - The appellant had not accepted the liability determined in the adjudication order dated 28.02.2007 and contested the adjudged demand confirmed therein before the appellate forums i.e. the Office of the Commissioner (Appeals) as well as before the Tribunal and finally succeeded before the Tribunal as per the order dated 26.10.2016. Thus, under the facts and the circumstances of the case, it cannot be said that the amount in question confirmed vide order dated 28.02.2007 was due to the Government, which can be recovered by taking shelter under Section 11 of the Act. Appeal allowed - decided in favor of appellant.

Summary

Issues:
- Appropriation of sanctioned rebate claims against outstanding dues confirmed in earlier adjudication orders
- Rejection of appeals by the Commissioner (Appeals) due to lack of stay order from the Tribunal
- Compliance with the terms of the stay order and extension granted by the Tribunal
- Contesting the adjudged demand before appellate forums and succeeding before the Tribunal

Analysis:
The appeals were directed against an order passed by the Commissioner (Appeals) regarding the appropriation of sanctioned rebate claims against outstanding dues confirmed in earlier adjudication orders. The appellant, engaged in the manufacture of paper products, exported goods under claim for rebate. The Deputy Commissioner had sanctioned the rebate claims, but they were appropriated against outstanding dues. The Commissioner (Appeals) upheld the rejection of appeals by the appellant. The appellant argued that since the earlier orders were in dispute and appealed against, Section 11 of the Act should not apply for appropriation.

The Authorized Representative for the appellant submitted that the Tribunal had partly allowed the appeals in favor of the appellant in a previous case related to the same matter. The appellant contended that the appropriation of the sanctioned rebate claimed amount should not have been done under Section 11 of the Act. The Learned AR for the respondent reiterated the findings of the impugned order.

Upon hearing both sides and examining the records, it was found that the original authority had sanctioned the rebate claim amount in favor of the appellant. The orders appropriating the sanctioned claim amount against earlier confirmed demands were appealed against and partly allowed by the Tribunal in favor of the appellant. The Commissioner (Appeals) rejected the appeals mainly due to the lack of a stay order from the Tribunal, but it was found that the Tribunal had directed for pre-deposit and granted an extension of stay until final disposal of the appeals.

It was observed that the appellant had contested the adjudged demand before appellate forums and succeeded before the Tribunal. The impugned order was deemed devoid of merit, and it was set aside. Consequently, the appeals filed by the appellant were allowed with the consequential benefit of the rebate claim.