2002 (6) TMI 553 - AT - Central Excise

Summary

Issues:
1. Excess Modvat credit taken by the appellant.
2. Short payment of duty by the appellant.
3. Disallowance of Modvat credit in excess.
4. Imposition of penalty by the Asstt. Commissioner.
5. Confirmation of demand of duty by the Commissioner (Appeals).
6. Claim for refund of the duty amount by the appellant.

Analysis:

1. The appellant, a manufacturer of Electric Transformer and Conductors, inadvertently took excess Modvat credit of Rs. 76,260/- instead of Rs. 16,740/-. They self-detected the error and reversed the excess amount in their records. However, when the excisable goods were cleared on 25-11-97, the appellant had a balance of only Rs. 73,293/- in their RG 23A, Part II, resulting in a short payment of duty amounting to Rs. 44,125/-. The Asstt. Commissioner confirmed the demand of duty short paid and disallowed the excess Modvat credit.

2. The appellant argued that they rectified their mistake by depositing the duty short paid twice - first on 26-11-97 and again on 4-11-99 as per the Interim Stay Order. They contended that they are entitled to a refund of the duty amount since they had deposited it twice. However, the Commissioner (Appeals) upheld the demand of duty but set aside the penalty imposed by the Asstt. Commissioner.

3. The Tribunal noted that the issue before them was the confirmation of the demand of duty, as neither the Asstt. Commissioner nor the Commissioner (Appeals) addressed the refund of the duty. The appellant did not dispute the duty short paid but focused on the claim for refund. The Tribunal emphasized that the appeal was rendered infructuous as the demand of duty was not contested by the appellant, and the proper course for them would be to file a refund claim for the duty paid twice.

4. Consequently, the Tribunal dismissed the appeal, stating that the issue at hand was the confirmation of the duty demand, which was not disputed by the appellant. The Tribunal clarified that the appellant's remedy lay in seeking a refund for the duty paid twice, rather than challenging the confirmed demand. Thus, the appellant's appeal was deemed infructuous, and no relief was granted regarding the refund of the duty amount.