2021 (3) TMI 625 - AT - Central Excise

Seeking appropriation of refund due to it in respect of one of its units against the demand in respect of its another unit - provisional assessment - the appellant had stated that before finalization of their balance-sheet and differential ED they had made the following advance payments towards the expected differential duty - HELD THAT - Undisputedly the appellant s request for appropriation was made vide its request letter dated 09.10.2017. There is also a communication from the Deputy Commissioner Poonamallee Divison that no refund claim was filed. Taking note of the above and considering the change in law with the introduction of C.G.S.T. the Commissioner (Appeals) Nagpur while considering refund/adjustment claim of Butibori Unit out of excess duty available with Poonamallee Unit has allowed the appropriation/adjustment of differential duty to be paid by the appellant s Butibori Unit against the excess amount of the appellant s Poonamallee Unit. It is to be noted that since the appellant unit (Butibori) was under LTU had there been no implementation of C.G.S.T. Act 2017 then the appellant could have normally adjusted the differential Central Excise Duty in LTU. In fact though this was brought to the notice of the First Appellate Authority here in the case on hand in the impugned order the same has been ignored for the reasons best known to the First Appellate Authority. It is not the case of the Revenue that the above order is a subject matter of appeal or has been reversed by higher fora. Admittedly the excess duty paid by the appellant that has remained with the Revenue has to be refunded to the appellant by following the due process of law as prescribed in the statute. Matter remanded back to the file of the Adjudicating Authority to look into the refund due as calculated by the appellant and then appropriate/adjust excess duty of the Poonamallee Unit if any available thereafter towards duty and interest liability of the unit in appeal here in terms with the findings and discussions of the Learned Commissioner (Appeals) Nagpur to avoid inconsistency.

Summary

Issues:
Challenge to rejection of plea for appropriation of refund against demand in different unit.

Analysis:
The appellant challenged the rejection of its plea for the appropriation of a refund due to it in respect of one unit against the demand in another unit. The undisputed facts revealed that the appellant opted for provisional assessments and made advance payments towards expected differential duty for all three units. The appellant claimed an excess payment in its Poonamallee Unit, seeking refund under the CGST Act, 2017. However, the Adjudicating Authority did not appropriate as requested but proceeded to demand duty for the Ambattur unit. The appellant appealed the decision after an unsuccessful attempt before the Commissioner of GST and Central Excise. Both sides presented their arguments, and various case laws were referred to during the proceedings.

In the adjudication, it was noted that the appellant's request for appropriation was made in a letter dated 09.10.2017, and there was a communication stating that no refund claim was filed. The Commissioner (Appeals) in Nagpur allowed the adjustment of differential duty of the Butibori Unit against the excess amount of the Poonamallee Unit. The order highlighted the change in law with the introduction of the CGST Act, 2017. The appellant's excess duty, which remained with the Revenue, needed to be refunded following the due process of law. The Tribunal set aside the impugned order and remanded the case to the Adjudicating Authority to review the refund due to the appellant and adjust any excess duty of the Poonamallee Unit towards the duty and interest liability of the unit in appeal, aligning with the findings of the Commissioner (Appeals) in Nagpur to ensure consistency.

The Tribunal disposed of the appeal by remanding the case back to the Adjudicating Authority for appropriate action regarding the refund and adjustment of excess duty, as per the findings and discussions of the Commissioner (Appeals) in Nagpur.