Section 11D applies only to duty-liable persons collecting excise duty excess; dealer sales of duty-paid goods were outside its reach.

Section 11D of the Central Excise Act is attracted only where the person is liable to pay excise duty and collects an amount in excess as excise duty from buyers. It was held prima facie inapplicable to dealer transactions involving duty-paid petroleum products, because the appellant was not itself liable to pay duty on those clearances. The same approach applied to sales of duty-paid goods received from refineries. However, for non-duty-paid clearances where the appellant was required to discharge duty, the record showed collection at the full normal rate while duty was paid only at a reduced rate, so Section 11D was prima facie attracted to that extent and partial pre-deposit was justified.

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Issues: Whether, for the purpose of waiver of pre-deposit and stay, Section 11D of the Central Excise Act, 1944 was prima facie attracted to demands raised where the appellant acted as a dealer in duty-paid petroleum products or where only part of the demand arose from non-duty-paid clearances.

Analysis: Section 11D applies only where the person is liable to pay duty under the Act or the rules and has collected an amount in excess of the duty assessed or determined as representing excise duty. Where the appellant merely dealt in duty-paid goods as a dealer, without being liable to pay excise duty on such goods, Section 11D was held to be inapplicable at the threshold. The same position was taken in relation to the demand arising from sale of duty-paid petroleum products received from refineries. However, in respect of the demand relating to non-duty-paid petroleum products on which the appellant was itself required to discharge duty, the material showed collection from buyers at 100% of the normal rate while duty was discharged only at 50% under the applicable notifications, and Section 11D was prima facie attracted to that extent.

Conclusion: Section 11D was not prima facie attracted to the demands arising from dealer transactions in duty-paid goods, but was prima facie attracted to the demand of Rs. 2,46,04,214/- relating to non-duty-paid clearances; therefore, a partial pre-deposit direction was justified and waiver was granted only on compliance.

Final Conclusion: The appeals were not finally decided on merits, but interim relief was granted only in part, with the stay operating subject to partial pre-deposit.

Ratio Decidendi: Section 11D is attracted only against a person liable to pay excise duty who collects an excess amount as excise duty from the buyer; it does not apply to a dealer dealing in duty-paid goods.

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