Suo motu re-credit recovery cannot stand where the same duty period was already settled and no double benefit arose.

Recovery of suo motu re-credit in CENVAT account was held unsustainable where the same duty amount for the same period had already been paid in cash and the refund dispute had earlier been decided in the assessee's favour. The Tribunal noted that the earlier refund ruling had accepted the legality of the CENVAT credit utilization during the default period, and no duplicated monetary benefit had been obtained because the amount had already been re-credited. On that basis, parallel recovery proceedings could not be maintained and the demand was set aside.

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Issues: Whether the demand for recovery of suo motu re-credit taken in the CENVAT credit account was sustainable when the same duty amount had already been paid in cash and the refund dispute concerning that very amount had been decided in favour of the assessee.

Analysis: The amount had earlier been paid in cash after utilization of CENVAT credit during the default period, and the Tribunal had already allowed the assessee's refund claim by holding that utilization of CENVAT credit during the default period was legal. The present recovery proceedings arose only because the assessee had, in the meantime, taken back the reversed amount in its CENVAT credit account. Since the same duty liability for the same period had already been the subject of proceedings and the refund issue stood allowed, the subsequent recovery action could not be sustained. The record also showed that no refund was being pursued again after the earlier order because the assessee had already re-credited the amount.

Conclusion: The demand for recovery of the suo motu credit was not sustainable and was set aside in favour of the assessee.

Ratio Decidendi: Where the same duty amount for the same period has already been adjudicated in refund proceedings and the assessee has not obtained any duplicated monetary benefit, a parallel recovery of suo motu re-credit cannot be sustained.

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