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2015 (9) TMI 1025 - CESTAT CHENNAI

2015 (9) TMI 1025 - CESTAT CHENNAI - TMI - Recovery of suo motu credit - credit of pre-deposit taken after a favorable decision without filing refund claim - demand differential duty - Re-classification of goods - Held that:- In the de novo proceedings, the adjudicating authority had limited his findings and ordered recovery by saying that appellants failed to produce any proof of filing refund claim as directed by the Commissioner (Appeals). There is a justification in Ld. consultant's submissi .....

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ngs in this case the consequential benefit is automatic in so far as the deposits made by the appellant during pendency of adjudication proceedings. Therefore, the question of refund claim under Section 11B and time-bar and unjust enrichment does not arise. Both the original authority and LAA conveniently overlooked all the above vital facts and held that what is paid by them is duty not paid under protest and also held as time-barred.

Amount paid by the appellant is only a deposit pe .....

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issue referred to Larger Bench was on excise duty paid and taking credit suo motu whereas in the present case as already discussed above the amount paid is only deposit during investigation proceedings. - impugned order upholding the recovery of credit with interest and imposition of penalty is liable to be set aside - Decided in favour of assessee. - Appeal No. E/382/2008 - Dated:- 26-5-2015 - R. Periasami, Member (T), J. For the Appellant : Mr P C Anand, Consultant For the Respondent : Mr M Ra .....

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offence case was registered. Five show cause notices were issued to the appellants proposing to re-classify the goods under Chapter Heading 2942.00 and also proposing to demand differential duty. The Commissioner of Central Excise in his Order No.15/2003 dt. 29.8.2003 adjudicated all the five SCNs pertaining to the period from July'96 to December'99 and dropped the proceedings initiated in the five SCNs. Consequent to the order, the appellants took suo motu recredit of amount paid by th .....

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to ascertain the fact of appellant's claim whether a refund claim was filed by the appellant or a notice under writing was submitted by the appellant before taking the re-credit and to consider the validity of the claim. The Additional Commissioner in his de novo order dt. 9.2.2007 again reconfirmed the amount with interest and also imposed a penalty of ₹ 10 lakhs under rule 13 of CCR. In the second round of appeal, Commissioner (Appeals) in the impugned order rejected their appeal. Bo .....

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ng pending proceedings by debiting cenvat credit in their RG.23A Part II and RG.23C Part-II. He further submits that payments were made under protest and they took re-credit on 30.11.2003 only after receipt of the Commissioner's order. He also submits that they have also filed refund claim under Section 11B and the Commissioner (Appeals) in his first order remanded the case to the adjudicating authority to verify the fact of filing the refund claim. He submits that they could not trace out t .....

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eligible for suo motu credit and the case is not covered under Section 11B even though they filed refund claim and pleaded to condone the failure to intimate the department which is only a procedural lapse. He relied on the following case laws :- (i) Ultra Tech Cement Ltd. Vs CCE Tirupati 2010 (261) ELT 696 (Tri.-Bang.) (ii) Commissioner Vs S.Subrahmanyan & Co. 2013 (296) ELT A123 (Guj.) (iii) Unique Structures And Tower Ltd. Vs CCE Raipur 2009 (248) ELT 263 (Tri.-Del.) (iv) Gujarat Enginee .....

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u recredit. Further in spite of appellant's claim before Commissioner (Appeals) that their refund claim is still pending before the jurisdictional authorities he submits that during de novo proceedings they failed to produce any evidence to that effect. He relied on the following case law :- (i) Campus Service (India) Pvt. Ltd. Vs CCE Coimbatore 2008 (9) STR 259 (Tri.-Chennai) (ii) BDH Industries Ltd. Vs CCE(A) Mumbai 2008 (229) ELT 364 (Tri.-LB) 7. I have considered the submissions made by .....

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hem appellant on payment of duty as pesticides under Chapter Heading 3808.10. Whereas department started investigation proceedings and sought to re-classify the goods under Chapter heading 2942.00 on the ground that technical grade pesticides are excluded from Chapter 38 of CETA. Consequent on dismissal of Revenue's appeal by the Hon'ble Supreme Court in the case of UOI Vs Pesticides Manufacturing and Formulators Associations of India - 2002 (146) ELT 19 (SC), the Commissioner of Central .....

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11B and not paid duty under protest as per Rule 233B of Central Excise Rules and the claim is time-barred and the appellant failed to produce any documentary evidence of refund claim already filed before Department. On perusal of the first OIO dt. 29.8.2003 passed by Commissioner of Central Excise relating to demand of excise duty, it is pertinent to reproduce the para-2 of the said OIO as under :- "On intelligence the officers of DGAE, Chennai and Officers of Central Excise Commissionerate .....

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d 1. 10% w.e.f. 23.7.1996 2. 8% w.e.f. 1.3.1997 It is clearly recorded from the above that officers of DGCEI visited appellant's unit on 9.7.97 and conducted search, recovered records, drawn panchanama (Mahazar) and recorded statement which is not disputed. With this background, it is relevant to see the lump sum amount paid by the appellant as brought out at para (4.4) of OIO dt. 13.6.2005 which is reproduced as under :- "Further they have stated that they have prayed for the refund of .....

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differential duty under protest and the differential duty ₹ 1,45,501/- without any protest. Further it is also noticed that they have paid the amount of ₹ 26,51,215/- voluntarily vide Sl.No.88 dated 9.07.97 of the RG23A PII. Therefore, it is observed that the assessee have paid the amount of ₹ 33,38,695/- as "differential duty" only and not as "deposit". The assessee's contention that they have always prayed for the refund of the amounts paid for earlie .....

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y evident that the appellant was made to pay duty on 9.7.97 by debit in RG 23 account during investigation carried out by DGCEI on 9.7.97. Therefore, it is proved beyond doubt that the lump sum amount paid by the appellant during investigation is not the duty amount calculated by the department but only deposit made by the appellants pending investigation proceedings. It cannot be construed that the appellants paid excise duty. This is supported by the Tribunal's decision in the case of Guja .....

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ntral Excise Officers. I find from the records that the amount which has been deposited by the TR-6 challan dated 2-8-2005 was a round figure of ₹ 1,00,000/- which cannot be considered as a duty but has to be considered as a deposit as the subsequent show cause notice which was issued to the assessee, as hereinabove recorded, is for an amount of ₹ 41,81,875/-. Hence in my view, an amount of ₹ 1,00,000/- deposited by the appellant even under panchanama cannot be considered as a .....

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nd, the amount which has been sought as a refund by the appellant is not a duty which become refundable as a consequence of judgment but an amount which has been deposited by the appellant as a pre-deposit during the course of investigation. I find that Division Bench judgment of the Tribunal in the case of Motorola India Pvt. Ltd. and Toyota Kirloskar Auto Parts Pvt. Ltd. and also the decision of the coordinate bench in the case of Birla Ericsson Optical Ltd. is on the point that an amount whic .....

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ve paragraphs, it is evident that amount deposited during investigation is clearly established. Therefore the amount deposited during investigation is only a deposit and not central excise duty. 12. Notwithstanding above, on scrutiny of the extracts of relevant pages RG23A & RG23C Part II enclosed in the appeal book, I find that appellants have clearly written at the relevant entry Sl.nos that duty debited under protest which is sufficient to hold that the payments are not voluntary in the c .....

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nami attacked the East Coast in 2004 and caused calamity of huge loss of lives and damaged of house, property. That being a case, one cannot brush aside their plea that their office was totally damaged and ravaged by Tsunami and all their records damaged. I find this bonafide reason merits consideration as why they could not produce evidence before the authorities 13. Having held that the amount paid is only a deposit during investigation, it is to state that once adjudication authority dropped .....

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e appellants, as clearly discussed in detail above, the appellants took re-credit in RG23A & C on 30.11.2003 after the proceedings was dropped by the adjudicating authority vide order dt. 28.3.2003. The Commissioner in the above order not mentioning the word cannot be a valid ground for the jurisdictional authorities to deny the re-credit of deposits made by the appellants. 15. The Hon'ble Tribunal's Division Bench in the case of M/s.Ultratech Cement Ltd. Vs CCE (supra) had allowed a .....

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onsidered the submissions from both sides. This is a very strange case. There is no dispute about the fact that appellant is eligible for return of ₹ 5 lakhs made as pre-deposit in pursuance of the order of the Commissioner (Appeals). The Board's instructions envisages filing of a simple letter to enable grant of refund to the appellant. The appellant has filed letter dated 8-10-04. Instead of awaiting for cash refund, the appellant has chosen to take credit on 30-10-04 based on TR 6 c .....

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