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2018 (10) TMI 692

Excess amount collected ‘in the name of Central Excise duty’ - section 11D(1) and (1A) of the Central Excise Act, 1944 - case of assessee is that since they are not liable to pay duty on the goods sold by them, the provisions of section 11D of Central Excise Act, 1944 are not applicable in their case for a period prior to 10.5.2008 and also that the excess amount collected by them in the name of Central Excise duty has already been returned back by them to their customers - time limitation. - Held that:- It can be seen that section 11D(i) as it existed prior to 10.5.2008 provided that any person who is liable to pay duty under the Central Excise Act or rules, made thereunder need to pay back the excess amount collected by them, thus it appears on plain reading that it primarily covers the producer or manufacturer of excisable goods or the person storing such goods in a warehouse who pays the duty on excisable goods at the time of removal of such goods - contention of the assessee that they are not covered by the provisions of section 11D for a period prior to 10.5.2008, is not acceptable, since the depot of manufacturer assessee who is M/s. Hindustan Petroleum Corpn. Ltd. in th .....

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s from 2006-2007 to 2010-2011 wherein the excess amount of Central Excise duty amounting to ₹ 1,26,12,691/- is alleged to have been collected in excess of what has actually been paid by them to the department. Another Show cause notice dated 13.7.12 came to be issued for a period covering 01.04.2011 to 04.10.2011 wherein an amount was ₹ 19,06,199/- is allegedly collected in excess of what has been actually paid by them to the department. Both the show cause notices have demanded from the appellant to deposit the excess amount collected by them in the name of Central Excise duty under section 11D(1) and (1A) of the Central Excise Act, 1944. The matter has been decided by the Commissioner (Appeals) vide his order dated 31.1.2018 wherein the above mentioned amounts collected by the appellant have been confirmed to be deposited by the assessee to the department under Section 11D of the Central Excise Act, 1944. Learned advocate appearing on behalf of the appellant have assailed the confirmation of excess amount collected by them claiming the same as Central Excise duty under section 11D on the following grounds: (i) It has been contended by learned advocate that the provisi .....

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that, firstly; the section 11D requires that any person who is liable to pay duty under this Act, who has collected any amount in excess of the duty leviable under Central Excise duty, same cannot be retained by the person who has collected it and same has to be returned and deposited with the Central Government as per the provisions of section 11D. It has also been contested by the learned DR that section 11D does not have any provisions of limitation for recovery of any amount which have been collected in the name of Central Excise duty and therefore, the learned advocate s argument that the Show cause notice is hit by limitation, is legally not sustainable. It has also been contested by the learned DR that the amount once collected even if returned thereafter have become due to Central Government as same was illegal collection by the appellant assessee in the name of Central Excise duty. It has also been contested that the credit notes shown by the learned advocate claiming to prove that excess amount collected from customers have been paid by them is actually not the payment of excess amount rather they have authorised the customers to avail cenvat credit of excess amount paid .....

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ction 11D(i) as it existed prior to 10.5.2008 provided that any person who is liable to pay duty under the Central Excise Act or rules, made thereunder need to pay back the excess amount collected by them, thus it appears on plain reading that it primarily covers the producer or manufacturer of excisable goods or the person storing such goods in a warehouse who pays the duty on excisable goods at the time of removal of such goods. In this regard, we are of view that the submissions made by the learned advocate that since they are not liable to pay duty on the goods sold by them and therefore, they are not covered by the provisions of section 11D for a period prior to 10.5.2008, is not acceptable to us since we find that the depot of manufacturer assessee who is M/s. Hindustan Petroleum Corpn. Ltd. in this case, is only an extension of the manufacturer and therefore, the provisions of section 11D are very much applicable on the extended arm of the manufacturer assessee, i.e. the depot of such assessee. It will be relevant to mention the definition of place of removal which is provided under the Section 4 of the Central Excise Act, 1944 reads as under:- place of removal means - (i) A .....

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possibility cannot be ruled out we feel that buyer may have taken the credit of these cenvat difference in their books of accounts and might have used them for further passing the cenvat credit to their customers. Seen from this angle, it is not a proper return of the excess collected amount which was in the name of Central Excise duty. Thus, we feel that excess amount collected in the name of Central Excise duty by the appellant-assessee does not stand returned back to their customers and therefore, same need to be deposited with the Central Government. 11. Now coming to the period of limitation, learned advocate for the appellant argued that the demand under section 11D is hit by period of limitation as the Hon ble Madras High Court held in the case of M/s. Gem Cables and Conductor Ltd. vs CCE Hyderabad (supra) that provisions of section 11A are also applicable to Section 11D. A plain reading of section 11D makes it evidently clear that no period of limitation has been prescribed under this particular section. The case which has been referred by learned advocate is a case where the provisions of section 11A along with section 11D of the Central Excise Act, 1944 were invoked whil .....

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