Customs, Excise and Gold Tribunal - Delhi
Sravasti Kisan Sahkari Chini Mills Ltd. vs C.C.E. on 30 August, 1995
Equivalent citations: 1996(81)ELT148(TRI-DEL)
ORDER G.P. Agarwal, Member (J)
1. These are four identically worded applications for dispensation of the mandatory requirement to pre-deposit the duty demanded that is to say Rs. 20,49/861/. Arguing on these applications, Shri Vinay Garg, the learned Counsel submitted that in the instant case, the demand was raised under Section 11D of the Central Excises and Salt Act, 1944 on the ground that the appellants had availed of exemption from excise duties in terms of Exemption Notification Nos. 130/83 and 131/83-C.E., both dated 27-4-1983 but recovered the same from their customers based on a higher rate of duty. The learned Counsel submitted that earlier also, such demand was raised for the earlier period and therefore, the appellants had to file their appeals along with the stay applications which were heard together on 25th July, 1995 and the Bench after taking into consideration the financial position of the appellants coupled with the question of law involved as to whether Section 11D would apply to the present case which relates to the period prior to September, 1991 directed the appellants to execute an undertaking before the Collector not to alienate their fixed assets corresponding to the duty amount in dispute in that case till the disposal of the appeal itself. He also drew our attention to the Tentative profit and loss account of the assessee for the year 1994-95 duly signed by the General Manager and Deputy Chief Accountant of the appellant company. He also took us through the Exemption Notification Nos. 130/83 and 131/83, both dated 27-4-1983 under which the appellants availed the exemption which the department wants to recover now on the ground that the excise duties were realised from the customers at a higher rate. In reply, Shri P.N. Das, the learned SDR submitted that Section 11D has a retrospective effect and the financial position as reflected in the Tentative profit and loss account of the appellant for the year 1994-95 shows the net profit for the year.
2. Considered. Section 11D was inserted by Section 5 of the Central Excises and Customs Laws (Amendment) Act, 1991 with effect from 20th September, 1991 and reads as follows :
"Section 11D. Duties of excise collected from the buyer to be deposited with the Central Government. - (1) Notwithstanding anything to the contrary contained in any order or direction of the Appellate Tribunal or any Court or in any other provision of this Act or the rules made thereunder, every person who has collected any amount from the buyer of any goods in any manner as representing duty of excise, shall forthwith pay the amount so collected to the credit of the Central Government".
Simultaneously, Section 11B was also suitably amended by providing i.e. to say the assessee has to establish that the amount of duty of excise in relation to which such refund is claimed was collected from, or paid by him and the incidence of such duty had not been passed by him to any other person provided that where an application for refund has been made before the commencement of the Central Excises and Customs Laws (Amendment) Act, 1991, such application shall be deemed to have been made under this Sub-section as amended by the said Act and the same shall be dealt with in accordance with the provisions of Sub-section (2) substituted by that Act. The question as to whether Section 11D would have a retrospective effect or prospective effect would be a debatable one though the Apex Court while interpreting the amended Section 11B has ruled that Section 11B has a retrospective effect. From the Tentative profit and loss account, we find that the sales of the appellants during the year 1994-95 was to the extent of Rs. 16,65,08,000/ and a provision for depreciation to the extent of Rs. 80 lakhs has been made out of cash profit during the year leaving a net profit of Rs. 1,09,000/. From the said Tentative profit and loss account for the year 1994-95, we also find that during the preceding year 1993-94, the appellants had made a cash profit of Rs. 1,19,91,000/ out of which they appropriated Rs. 43,07,000/ towards depreciation, leaving a net profit of Rs. 76.74 lakhs. Under these circumstances, we are not in a position to reconcile with the statement made by the appellant during the hearing of the stay application filed earlier in the other case and the order passed thereon to the effect that there were large carried forward loss in view of the heavy losses sustained in the past. Be that it may, we are considering the latest Tentative profit and loss account for the year 1994-95 and find that the appellants' liquidity position is very much sound. Thus taking all the facts and circumstances of the case, we direct the appellants to deposit Rs. 10 lakhs within eight weeks from the date of receipt of this order and report compliance to the registry. On compliance, the requirement to pre-deposit the balance amount of duty that is to say Rs. 10,49,861/ shall be deemed to have been waived and the recovery proceedings if started, shall remain stayed.
To come up on 22nd November, 1995 for passing suitable order after ascertaining the compliance of the stay order so passed.