Tribunal upholds Revenue's demands under Section 11D, requires deposit of excess duty.

The Tribunal dismissed the appeals, upholding the demands made by the Revenue. It found that Section 11D of the Central Excise Act applied retrospectively, requiring the deposit of excess duty collected from customers. The Tribunal rejected the argument that Section 11D did not cover Additional Duty of Excise, emphasizing the obligation to deposit duty amounts with the Government. It also upheld the allegation of suppression with intent to evade payment of duty, emphasizing the need to comply with legal requirements regarding duty collection and payment.

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Issues:
Common issue involving retrospective application of Section 11D of the Central Excise Act and applicability to Additional Duty of Excise (Goods of Special Importance), suppression with intent to evade payment of duty.

Analysis:
1. Retrospective Application of Section 11D:
The appellants contended that demands made prior to 20.9.1991 are not covered under Section 11D of the Central Excise Act, which was introduced on that date. However, the Tribunal found that the demands were valid as the Show Cause Notice was issued after the introduction of Section 11D. Referring to the decision in Kisan Sahkari Chini Mills Ltd. case, the Tribunal held that the appellants were required to deposit amounts collected from customers post the introduction of Section 11D. Thus, the demand was deemed sustainable under the law.

2. Applicability to Additional Duty of Excise:
The appellants argued that Section 11D does not apply to Additional Duty of Excise (Goods of Special Importance). However, the Tribunal clarified that Section 11D covers any person collecting amounts from buyers as duty, which must be deposited with the Central Government. As the appellants were collecting more duty from customers than paying to the Government, the Tribunal rejected the contention that Section 11D does not apply in this scenario.

3. Suppression with Intent to Evade Payment of Duty:
The Revenue contended that the appellants collected excess duty from customers compared to what was paid to the Revenue, indicating suppression with intent to evade payment of duty. The Tribunal found merit in this argument as the appellants charged higher duty from customers while paying less to the Government. This fact came to light during scrutiny, leading to the conclusion that the allegation of suppression was sustainable. Referring to the Supreme Court decision in Kisan Sahkari Chini Mills Ltd., the Tribunal emphasized that any excess duty collected must be deposited with the Government as per Section 11D.

4. Incentives and Excise Duty Concessions:
The appellants were granted incentives based on a Government order, allowing for excise duty concessions. However, they were found to have charged customers full excise duty while paying only concessional rates to the Government. This discrepancy led to the demands and subsequent legal proceedings. The Tribunal upheld the necessity for the appellants to deposit amounts collected in excess of the duty assessed or determined with the Central Government, as mandated by Section 11D.

In conclusion, the Tribunal dismissed the appeals, citing the applicability of Section 11D to the case, the obligation to deposit excess duty collected, and the unsustainable suppression of facts with intent to evade payment of duty. The decision aligned with legal precedents and upheld the demands made by the Revenue.

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