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2023 (11) TMI 964 - AT - Central ExciseRecovery of refund - Exemption to new industrial units which commenced its commercial production on or after 24.12.1997 - goods cleared from units located in Export Promotion Industrial Parks (EPIP) in the State of Assam - benefit of N/N. 32/99-CE dated 08.07.1999 - HELD THAT - Similar issue in the case of M/s Ozone Pharmaceuticals Limited Vs Commissioner of Central Excise and service Tax, Guwahati 2023 (9) TMI 1371 - CESTAT KOLKATA , wherein the appeal filed by the Appellant was allowed - it was held in the said case that the refund claim of the appellants for the subsequent period, could not be rejected on the ground that the appellant has taken excess refund for the period prior to 22.12.2002, therefore, no demand is sustainable against the appellant as demanded in view of the letter dated 03.06.2003 by the Deputy Commissioner and the refund for the period August, 2006 to October, 2006 were not required to be appropriated. The ratio of the above cited decision is squarely applicable in this case as the facts and circumstances of the present case on hand is same as the case cited above. Thus, by following the ratio of the above cited decision, it is held that the demand confirmed in the impugned order is not sustainable. Appeal allowed.
Issues Involved:
1. Validity of the demand and interest confirmed by the adjudicating authority. 2. Interpretation of amendments to Notification No. 32/99-CE and their retrospective application. 3. Compliance with the amended notification and utilization of CENVAT credit. 4. Applicability of judicial precedents and revenue neutrality. Summary: 1. Validity of the Demand and Interest Confirmed: The appeal challenges the order dated 12.02.2015 by the Commissioner (Appeals), Guwahati, which upheld the adjudicating authority's orders confirming a demand of Rs. 39,81,566/- with interest of Rs. 19,93,201/- for the period 24.02.2000 to 22.12.2002. The Appellant, a manufacturer of cosmetics, had availed the benefit of Notification 32/99-CE and claimed refunds of excise duty paid through PLA. 2. Interpretation of Amendments to Notification No. 32/99-CE and Their Retrospective Application: Notification 61/2002-CE, effective from 23.12.2002, amended Notification 32/99-CE, stipulating that refunds would only be allowed after utilizing the entire CENVAT credit. The Finance Act, 2003, gave retrospective effect to this amendment from 08.07.1999, allowing the department to recover any excess refunds within 30 days. 3. Compliance with the Amended Notification and Utilization of CENVAT Credit: The Appellant argued that they complied with the amended notification from 23.12.2002 onwards by utilizing accumulated CENVAT credit for duty payments, resulting in no refunds for some months in 2003. They contended that the excess refund claimed before 22.12.2002 was adjusted by lower or nil refunds post-amendment, fulfilling the intent of the retrospective amendment. 4. Applicability of Judicial Precedents and Revenue Neutrality: The Appellant cited several judicial precedents, including the CESTAT Delhi's decision in Commissioner of C. Ex., Jammu vs. New India Wire and Cables, which held that subsequent utilization of CENVAT credit negated any revenue loss, making demand unsustainable. The Tribunal also referenced similar cases like M/s Singla Cables and others, emphasizing that demand is not sustainable if the situation is revenue neutral. Tribunal's Decision: The Tribunal, referencing its own decision in M/s Ozone Pharmaceuticals Limited and other similar cases, concluded that the demand confirmed in the impugned order was not sustainable. The appeal was allowed with consequential relief, if any, as per law. The Tribunal emphasized that the facts and circumstances of the present case were identical to the cited precedents, reinforcing the principle of revenue neutrality and the proper utilization of CENVAT credit.
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