2020 (2) TMI 514 - AT - Central Excise

Refund of excess duty - manufacture of clinker and cement - appellant was required to pay the duty @ ₹ 350 PMT as per the Notification No.4/2007, since there was a confusion during the relevant time, they paid the duty @ ₹ 400 PMT and subsequently filed refund claim - HELD THAT - In the present case, the appellant has supplied the cement to Government bodies i.e. M/s. AP Housing Corporation, Hyderabad - Further as per the N/N. 4/2007 which prescribes the rates of duty, the appellant s case falls under Sl.No.1A which prescribes the rate of duty @ ₹ 350 PMT. N/N. 4/2007 has prescribed different rates for different categories. Sl.No.1(A) prescribed the rate of ₹ 350/- PMT whereas the sl.No.1(C) prescribed the rate of ₹ 400 PMT. If the conditions laid down under a particular Sl.No. is satisfied, the manufacturer is allowed to manufacture goods prescribed against the said sl.no. Further, in this case, the goods were in packaged form being marked with the RSP and the price being less than ₹ 190 / bag even though the supply was to the Government undertaking and hence the rate applicable is only ₹ 350 PMT and not ₹ 400 PMT at which the appellant has paid the duty. Refund allowed - appeal allowed - decided in favor of appellant.

Summary

Issues:
Appeal against Commissioner(Appeals) order setting aside refund of excess duty granted to the appellant.

Analysis:
The appellant, engaged in cement manufacturing, cleared cement at a higher duty rate than required due to confusion regarding duty rates under Notification No.4/2007. The appellant paid duty at &8377; 400 per MT instead of &8377; 350 PMT as prescribed for RSP below &8377; 190 PMT. Despite invoicing at the lower rate, confusion led to the higher payment. The Assistant Commissioner granted a refund, but the Commissioner(Appeals) reversed this decision.

The appellant argued that the impugned order failed to appreciate facts and binding precedents. They contended that the confusion during the relevant period justified their payment at the higher rate and subsequent refund claim. Referring to the Notification, the appellant highlighted the exemption under Sl.No.1A for goods sold at prices below &8377; 190 PMT. They cited a Tribunal case supporting their entitlement to the exemption.

The respondent defended the Commissioner(Appeals) order, leading to a detailed analysis by the Tribunal. The Tribunal noted that the appellant supplied cement to a government body, falling under Sl.No.1A of Notification No.4/2007, which prescribed duty at &8377; 350 PMT for goods sold below &8377; 190 per bag. Different categories had varying duty rates, with Sl.No.1C at &8377; 400 PMT. The Tribunal found the appellant's case fitting Sl.No.1A due to the lower prices, contrary to the duty paid at &8377; 400 PMT. The original authority approved the refund based on facts, but the Commissioner(Appeals) misinterpreted the Notification, leading to the appeal.

Relying on a precedent involving Sagar Cements Ltd., the Tribunal emphasized that the appellant's practice of marking RSP on bags aligned with the requirement, justifying the lower duty rate. The Tribunal rejected the Revenue's appeal, concluding that the impugned order lacked legal sustainability. By setting aside the Commissioner(Appeals) decision, the Tribunal allowed the appellant's appeal.

In conclusion, the Tribunal's detailed analysis of the Notification, precedents, and factual circumstances led to the setting aside of the Commissioner(Appeals) order, allowing the appellant's appeal on the refund of excess duty paid.