Appellant not liable for predecessor's dues; excise dues not tied to property; refund granted

The tribunal held that the appellant was not liable for the predecessor's dues as the relevant law was not in force at the time of purchase. Citing a Supreme Court judgment, it was concluded that excise dues are not statutory liabilities tied to the property or machinery. Therefore, the appellant was not obligated to pay the dues, and the amount paid was deemed refundable. The appeal was allowed, and the order rejecting the refund claim was set aside, granting consequential relief to the appellant.

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Issues:
Appeal against rejection of refund claim due to liability of predecessor's dues on subsequent owner.

Analysis:
The appellant purchased factory premises through auction, which were previously allotted to M/s. Regency Industries Ltd. Dues of Central Excise from 1992-1993 were confirmed against M/s. Regency Industries Ltd. The premises were later auctioned to M/s. Amco Vinyl Ltd. and then purchased by the appellant in July 2004. The appellant paid a sum after taking possession and filed a refund claim, which was rejected based on liability transfer. Appellant argued they were not liable for predecessor's dues as the relevant law came into effect after their purchase, citing legal precedents.

The Revenue contended that the appellant was contractually obligated to pay predecessor's dues upon acquiring the premises. During the hearing, the Revenue was asked to explain why dues were not recovered earlier. The report provided lacked clarity on the status of the appeal filed by M/s. Regency Industries Ltd. against the dues. The tribunal found that when the appellant acquired the premises, the relevant law was not in force, making them not liable for the predecessor's dues. Referencing a Supreme Court judgment, the tribunal concluded that excise dues are not statutory liabilities arising from the property or machinery, thus the appellant was not obligated to pay the predecessor's dues.

Relying on the Supreme Court decision, the tribunal held that the appellant was not legally bound to pay the predecessors' dues. Consequently, the dues paid by the appellant were deemed refundable. The impugned order rejecting the refund claim was set aside, and the appeal was allowed with consequential relief.

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