CNH Industrial (India) Pvt. Ltd. Vs Commissioner of Central Excise (CESTAT Mumbai)
Recovery based on erroneous refund unsustainable as adjudication taken place u/s. 11B of the Central Excise Act
CESTAT Mumbai held that once the adjudication has taken place under section 11B of the Central Excise Act there cannot be recovery on claim of ‘erroneous refund’ under section 11A of the Central Excise Act.
Facts- The main allegation on the appellant is that they have aided and abetted the Appellant 1 by willfully furnishing fraudulent documents so as to enable them file the refund claim. Further, it is also alleged that the appellant has admitted in their statements that they had obtained dated receipt of the cheques of differential amount the taxi owners without physically handing over these cheques to the taxi owners. Photocopies of the cheques were forwarded to M/s Premier Automobiles Ltd (M/s PAL) for filing the refunds.
Conclusion- Once the adjudication has taken place under Section 11B of Central Excise Act cannot proceed to recover on the basis of “erroneous refund” under Section 11A so as to enable the refund order to be revoked, as the remedy lied under Section 35E for applying to the Appellate Tribunal for determination and not invoking Section 11Aof Central Excise Act.
FULL TEXT OF THE CESTAT MUMBAI ORDER
These appeals are directed against order in original No 13/Commr/M-II/2011 dated 30.11.2011/12.12.2011 of the Commissioner Central excise Mumbai II. By the impugned order following has been held:
“ORDER
1. I have confirmed the demand of Rs. 20,88,391/- (Rupees Twenty Lakhs Eighty Eight Thousand Three Hundred Ninety One Only) erroneously refunded to M/s Fiat India Ltd. Under proviso to sub-section (1) of Section 11A of the Central Excise Act, 1944.
2. The assessee is eligible for refund claim of Rs.15,92,889/-(Rupees Fifteen Lakhs Ninety Two Thousand Eight Hundred Eighty Nine Only), which they should claim with the jurisdictional Assistant/Deputy Commissioner in terms of Section 11B of Central Excise Act, 1944
3. I impose Penalty of Rs. 20,88,391/- on M/s Fiat India Ltd. Under Section 11AC of Central Excise Act, 1944
4. I charge and demand interest at appropriate rate per annum from M/s Fiat India Ltd. on the entire amount of duty erroneously refunded to them under Section 11AB of Central Excise Act, 1944.
5. I impose a penalty of Rs. 10,00,000/- on M/s PAL under Rule 209 A of the Central Excise Rules, 1944.
6. I impose following penalties on dealers under Rule 209A of Central Excise Rules, 1944.
