Rule 57CC reversal not treated as excise duty for Section 11D, so pre-deposit and recovery were stayed.

An amount reversed under Rule 57CC and shown in the invoice as "Modvat reversal under Rule 57CC" was treated on a prima facie basis as not being excise duty for Section 11D. The rule itself did not describe the amount as duty, the departmental clarification also treated it as outside excise duty, and the amount was not linked to any tariff rate. On that basis, it was held not prima facie recoverable under Section 11D, and pre-deposit was waived with stay of recovery granted.

---

---

Issues: Whether the amount reversed under Rule 57CC and shown in the invoice as "Modvat reversal under Rule 57CC" could be treated as duty for the purposes of Section 11D and, consequently, whether pre-deposit and recovery should be insisted upon.

Analysis: The amount required to be deposited under Rule 57CC was not described by the rule itself as duty, and the departmental clarification referred to in the order also treated it as not being excise duty. The amount was not linked to any tariff rate and was specifically reflected in the invoice as "Modvat reversal under Rule 57CC", rather than as duty. On that prima facie basis, the amount did not answer the description of duty so as to attract Section 11D.

Conclusion: The amount was not prima facie liable to be recovered under Section 11D, and the requirement of pre-deposit was waived with stay of recovery granted in favour of the assessee.

Final Conclusion: The stay application succeeded on the prima facie character of the amount as a Rule 57CC reversal and not excise duty, resulting in suspension of the demanded pre-deposit and recovery.

Ratio Decidendi: An amount expressly reversed under Rule 57CC and not represented as excise duty in the invoice cannot, on a prima facie view, be treated as duty for the purposes of Section 11D.

---