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TMI Blog2024 (3) TMI 488X X X X Extracts X X X X X X X X Extracts X X X X ..... set it may be pointed out that the aforesaid two situations relied upon by the Ld.Commissioner(Appeals) do not cater to a situation of revenue neutrality and are concerned where price revision had happened and duty short paid was subsequently paid by way of supplementary invoices raised in favour of the customers to whom the goods were sold form the factory gate. There is marked difference with the scenarios and for this reason, the aforesaid Supreme Court s decisions are not applicable to the facts of the present case. It is not deniable that there ought to be an adjustment of excess duty paid against the cases of short payment of duty. However, the appellant is not seeking any such interference at this stage. It is a fact that ignoring duty paid in excess and only considering the duty that has been short paid would lead to an anomalous situation where it would tantamount to retention of undue tax by the Government in clear violation of the stipulation of Article 265 of the Constitution. Revenue Neutrality - HELD THAT:- There are series of cases wherein it has been held that in a revenue neutral situation demand for duty does not arise - Reliance can be placed in the case of Hinda ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unit at Hisar and has paid duty thereon. They further state that for the months wherein the initial duty payment was in excess vis- -vis the value as arrived in terms of CAS-4 figures, the same was ignored. They state that they have not filed any refund claims on such duty paid in excess. 4. The department vide letter dated 29.04.2009 called upon the appellant to pay interest as upon verification of records it was noticed that the assessee had paid differential duty of Rs.1,21,14,526/- (April to July 2006) and Rs.4,18,56,578/- (2007-08) and therefore were required to pay Rs.26,74,457/- and Rs.76,06,965/- by way of interest on the said sums. As the appellant disputed the said seeking of interest, the department vide its letter dated 04.11.2010 threatened to take recourse to coercive measures in case of non-compliance and vide letter dated 09.11.2010 confirmed an amount of interest totalling Rs.1,29,77,820/- for the period for which the aforesaid differential duty was paid by the appellant. 5. In appeal filed by the appellant before the Ld.Commissioner(Appeals) no respite was accorded and therefore the appellant is in appeal before us challenging the impugned order of the Ld.Commissi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ayment of duty, interest as automatic and is better considered as compensation . For these findings, the Ld.Commissioner has relied upon the Hon ble Supreme Court s pronouncement in the case of Commissioner of Central Excise v. International Auto Ltd. [2010 (250) E.L.T. 3 (S.C.)] and Commissioner of Central Excise, Pune v. SKF India Ltd. [2009 (239) E.L.T. 385 (S.C.)]. 10. At the outset it may be pointed out that the aforesaid two situations relied upon by the Ld.Commissioner(Appeals) do not cater to a situation of revenue neutrality and are concerned where price revision had happened and duty short paid was subsequently paid by way of supplementary invoices raised in favour of the customers to whom the goods were sold form the factory gate. There is marked difference with the scenarios and for this reason we are of the view that the aforesaid Supreme Court s decisions are not applicable to the facts of the present case. 11. Reverting to the legal issues, as arising in the present case, we note that it is not deniable that there ought to be an adjustment of excess duty paid against the cases of short payment of duty. However, the appellant is not seeking any such interference at th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was not payable, question of payment of interest would not arise. Relevant para of the judgement is quoted below:- 15. As held by the Hon ble Gujarat High Court in the case of CCE C, Vadodara-II v. Indeos Abs Ltd. [2010 (254) ELT 628 (Guj.)], in case the goods were cleared to their own sister concern, which is availing benefit of the Modvat Credit, hence the entire exercise is revenue neutral. Although the appellant paid differential duty later on, but same was available as Cenvat Credit to their sister unit is a revenue neutral situation, if appellant would have not paid differential duty that was not payable in terms of the above cited decisions. Therefore, as duty was not payable, the payment of interest does not arise in the case of revenue neutral situation. Further the case law relied upon by the Ld.AR for the department in the case of Indoworth (India) Ltd. (supra), is not applicable to the facts of the present case as in that case the appellant sought refund of interest paid on Service Tax which was not payable by the assessee. 14. To similar effect is the law as laid down by this Tribunal in the case of Steel Authority of India Ltd. v. Commissioner of Central Excise, Bolpu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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