2017 (1) TMI 1703 - HC - Central Excise

Court requires deposit of excess excise duty collected under incentive schemes to Government

COMMISSIONER OF CENTRAL EXCISE Versus KISSAN SAHKARI CHINI MILLS LTD.

COMMISSIONER OF CENTRAL EXCISE Versus KISSAN SAHKARI CHINI MILLS LTD. - 2019 (369) E.L.T. 194 (All.) Issues:1. Whether incentives allow the appellant to collect more excise duty than paid and retain the excessRs.2. Should the party be careful in their business practices as per the lawRs.Analysis:1. The case involves an appeal by the Central Excise Department under Section 35G of the Central Excise Act, 1944 for the period September, 1991 to January, 1993. The main issue is whether the appellant, who collected excise duty at a higher rate than paid, is required to deposit the excess amount with the Government as per Section 11D of the Central Excise Act, 1944.2. The appellant had collected excise duty at a rate of Rs. 85 per quintal from buyers but had only deposited duty at Rs. 52 per quintal. This resulted in the retention of excess amounts by the appellant. A notice was issued under Section 11D for the recovery of the surplus collected amount, leading to a legal dispute.3. The court referred to a previous decision by the Hon'ble Apex Court, which clarified that under incentive schemes, the assessee cannot collect more excise duty than what is due to the Government. If excess duty is collected, it must be deposited with the Government, as mandated by Section 11D of the Central Excise Act.4. The appellant's reliance on a previous court decision was noted, but the court upheld the principle established by the Hon'ble Apex Court regarding the obligation to deposit excess excise duty collected. The questions of law were answered in favor of the department and against the assessee.5. Ultimately, the court allowed the appeal in favor of the department, emphasizing the importance of complying with the provisions of the Central Excise Act. No costs were awarded in this judgment.