2017 (12) TMI 275 - AT - Central Excise

Rebate - Section 11 of the Central Excise Act 1944 - Held that - certain amount of confirmed dues recoverable by revenue have been adjusted while sanctioning rebate claims under Section 11 of the Central Excise Act 1944 - the status of demand at the time of adjustment of demand against refund needs to be the key criteria for deciding if the said adjustment was done rightly or wrongly. It is a recovery under Secation11of the Central Excise Act 1944 just like any other recovery against a confirmed demand. Since the amount has been recovered it would be due for refund only if the appellant succeeds finally with respect to such demand - appellant can file a refund claim - appeal dismissed - decided against appellant.

Summary

Issues:
Adjustment of demands against refund claims sanctioned.

Analysis:
The appeal was filed by M/s. Ultra Tech Cement Ltd. against the adjustment of certain demands confirmed by the original adjudicating authority and first appellate authority against refund claims. The appellant argued that the demands against which the rebate was adjusted have not been upheld by the Tribunal. One order was set aside, and the other was remanded. The appellant also cited a decision of the Hon'ble High Court of Karnataka regarding rebate appropriation towards interest amounts. The Revenue relied on a decision of the Hon'ble High Court of Mumbai and the impugned order. The Tribunal examined the provisions of Section 11 of the Central Excise Act, 1944, which allows the deduction of amounts payable to the government from money owed by the person. The Tribunal noted that the demands adjusted against rebate claims had been set aside by the Tribunal, but the show-cause notices demanding duty had not been set aside. Therefore, the Tribunal concluded that the adjustment was valid at the time it was made, and the amount would be due for refund only if the appellant succeeded finally with respect to such demands. The Tribunal emphasized that the status of the demand at the time of adjustment is crucial in determining the validity of the adjustment. Consequently, the Tribunal dismissed the appeal, stating that the appellant could file a refund claim if they succeed in the final adjudication of the demands.