Section 11D applicability over reversed or collected excise amounts referred for Larger Bench consideration

Conflicting Tribunal views on whether amounts reversed or paid at 8% on exempted goods, when also collected from buyers, attract Section 11D of the Central Excise Act, 1944 led the Bench to treat the matter as a question of law requiring authoritative resolution. After noting earlier decisions supporting both positions, the Bench held that the controversy could not be finally decided at that stage and required examination by a Larger Bench. The issue was therefore referred to the Hon'ble President for constitution of a Larger Bench.

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Issues: Whether the question whether 8% reversed or paid on exempted goods and collected from buyers attracts Section 11D of the Central Excise Act, 1944 should be referred to a Larger Bench.

Analysis: The appeals raised conflicting views on the applicability of Section 11D where the assessee had reversed or paid 8% under the relevant excise and cenvat rules and had also collected the amount from buyers. Earlier decisions supporting both sides were noticed, and the matter was viewed as involving a question of law requiring resolution in the light of divergent Tribunal views. The Bench therefore concluded that the controversy could not be finally decided at that stage and required consideration by a Larger Bench.

Conclusion: The issue was referred to the Hon'ble President for constitution of a Larger Bench.

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