Section 11D demand fails where invoices show nil duty and contract price alone does not prove excise duty collection.

Excise duty could not be treated as having been collected from the buyer merely because the contract price was stated as inclusive of taxes when the excise invoices showed nil duty. Reading section 11D with sections 12A and 12B, the relevant inquiry was whether duty had actually been shown or passed on through the documents and statutory presumption, and the available record did not establish such collection. The demand under section 11D was therefore found unsustainable at the prima facie stage, and pre-deposit of the demanded amount and interest was waived with recovery stayed.

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Issues: Whether the amount alleged to have been recovered from the buyer could be treated as collection of excise duty and demanded under section 11D, and whether pre-deposit of that amount and interest should be waived.

Analysis: The pipes were supplied under a contract stating a consolidated price inclusive of taxes, but the excise invoices showed nil duty. The question whether section 11D applied had to be read with sections 12A and 12B, under which the duty shown in the documents and the statutory presumption regarding passing on duty incidence are relevant. On the available record, mere inclusion of taxes in the contract price did not by itself establish collection of an amount as excise duty. The earlier view relied on by the Tribunal also supported the prima facie case that no amount representing excise duty had been collected in the invoices when duty was shown as nil.

Conclusion: The demand under section 11D was held to be unsustainable at the prima facie stage, and the requirement of pre-deposit of the demanded amount and interest was waived; recovery was stayed.

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