2005 (1) TMI 138 - AT - Central Excise

Summary

Issues: Appeal against rejection of refund claim for 8% duty collected from customers by mistake.

Analysis:
The appellant, engaged in manufacturing P.P. medicaments, filed an appeal against the rejection of their refund claim by the Commissioner (Appeals). The dispute arose from the collection of 8% duty on certain products cleared without payment of Central Excise duty. The appellants paid Rajasthan State Excise duty on these medicines, which were not liable for Central Excise duty. They availed Modvat credit for inputs used in both excisable and non-excisable goods. A show cause notice was issued under Section 11D of the Central Excise Act for recovery of the 8% amount collected from customers. The appellants contended that they mistakenly showed 8% excise duty on invoices for non-excisable goods and sought a refund on this basis.

The Revenue argued that since the appellants collected 8% as Central Excise duty and separately mentioned it in the invoices, the amount should be credited to the Central Government. The Tribunal noted that the appellants did not dispute collecting 8% from customers and explicitly mentioned it as Central Excise duty on the invoices. The only contention was that the mention of 8% as Central Excise duty was a mistake. As the appellants collected the 8% duty separately and acknowledged it in the invoices, the provisions of Section 11D were found applicable, leading to the dismissal of the appeal. The Tribunal held that the appellants were not entitled to a refund of the amount collected.