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2015 (10) TMI 913 - CESTAT NEW DELHI

2015 (10) TMI 913 - CESTAT NEW DELHI - 2015 (323) E.L.T. 369 (Tri. - Del.) - Demand of interest - Invocation of extended period of limitation - whether the respondent is entitled to adjust the abated amount in their duty liability for the month of February, 2011 or not - Held that:- The adjustment of abated amount against the duty liability for the month of February, 2011 was intimated by the respondent to the department well within time and department has not taken any action thereon. Further, .....

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same was to be sanctioned immediately but same has not been done. Moreover, when there is a short payment of duty for the month of February, 2011, no show cause notice for demand of duty has been issued to the respondent. Therefore, demand of interest is not sustainable. - Admittedly, in this case the fact of adjustment of abetment amount to duty against the duty liability for the month of February, 2011 was in the knowledge of the department. Therefore, show cause notice cannot be issued by inv .....

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ld. Commissioner (A). 2. The facts of the case are that respondent is manufacturer of Pan Masala containing Tobacco known as Gutkha. The respondent has 99 FFS machines of Single Track out of which 81 FFS Machines of single MRP ₹ 1 per pouch were operative in the month of January, 2011, i.e., 1-1-2011 to 15-1-2011 and 18 FFS machines of single track were already sealed and installed. The respondent paid duty for 81 FFS Machines of Single Track at the rate of ₹ 12.5 lakhs per mac .....

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90 FFS machines of single track of MRP ₹ 1 intended to be used for production from 1-2-2011 and same was done. As per Rule 97 of the said rules the respondent was required to pay duty amounting to ₹ 11,25,00,000/- by 5-2-2011 for the month of February, 2011. The Respondent intimated to the Revenue on 2-2-2011 that they will utilize the amount of duty of ₹ 5,22,58,065/- of abatement of excess duty paid during January, 2011 towards duty payable for the month of February, 2011. It .....

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st. Therefore, the revenue is in appeal before me. 3. The ld. AR appeared on behalf of the revenue submits that in this case abatement was sanctioned on 4-5-2011. Therefore, for the period 5-2-2011 to 3-5-2011 there was no duty credit in the account of the respondent. Therefore, for the intervening period respondent are liable to pay interest. As abatement is similar to the refund, credit of the refund cannot be taken suo motu. Therefore, impugned order is required to be set aside. He also .....

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plication thereon. It is not in dispute that respondent are entitled to claim abatement and it was intimated to the department in advance that in the month of February, 2011 the respondent shall adjust the amount of abatement in duty liability for the month of February, 2011. Further, it is submitted that if there is a shortage of duty for the month of February, 2011 no notice of demand has been issued to the respondent. Consequently, demand of interest is not sustainable. It is further submitte .....

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he liability of duty against the respondent is as per Section 3A(3) of Central Excise Act, 1944 read with Pan Masala Packing Machine Rules, 2008. On going through the above said provisions, there is no procedure for filing the abatement claim and same cannot be utilized without prior sanction of the departmental officers. The amount of abatement is not in dispute when the respondent applied for adjustment on 2-2-2011 the claim of abatement if at all required by the revenue to be sanctioned the s .....

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