Finality of unchallenged orders bars collateral interference; duty during forfeiture must be paid through PLA, not Cenvat credit.

An appellate authority cannot annul an unchallenged forfeiture order that has attained finality, because its jurisdiction is confined to the scope of the appeal. During the forfeiture period, duty was required to be paid in the manner directed by the proper officer, namely through the PLA; payment through the Cenvat account was impermissible and treated as contrary to the statutory payment regime. The impugned order was therefore set aside and the matter remanded for fresh decision on the disputed issue in accordance with law.

---

---

Issues: (i) Whether the Commissioner (Appeals) could invalidate the Superintendent's order forfeiting the facility of payment of duty in instalments when that order had not been appealed against; (ii) Whether, during the period of forfeiture, duty was required to be paid only from the PLA and not from the Cenvat account.

Issue (i): Whether the Commissioner (Appeals) could invalidate the Superintendent's order forfeiting the facility of payment of duty in instalments when that order had not been appealed against.

Analysis: The Superintendent's order forfeiting the facility was not the subject-matter of appeal before the Commissioner (Appeals). The assessee had accepted that order and had acted upon it by shifting to consignment-based payment. In such circumstances, the forfeiture order had attained finality, and the appellate authority could not travel beyond the scope of the challenge to set it aside on a collateral basis.

Conclusion: The Commissioner (Appeals) was not justified in invalidating the Superintendent's order, and the Revenue succeeded on this issue.

Issue (ii): Whether, during the period of forfeiture, duty was required to be paid only from the PLA and not from the Cenvat account.

Analysis: Rule 173G(1)(e) required that, upon forfeiture of the instalment facility, duty for the prescribed period had to be paid in the manner directed by the proper officer, i.e. through the PLA. The Tribunal followed its earlier view that payment through Cenvat credit during the forfeiture period was not in accordance with law and would amount to clearance without payment of duty.

Conclusion: Duty during the forfeiture period had to be discharged from the PLA only, and payment through the Cenvat account was impermissible; this issue was decided in favour of the Revenue.

Final Conclusion: The impugned order was set aside and the matter was sent back to the Commissioner (Appeals) for fresh decision on the disputed issue in accordance with law.

Ratio Decidendi: An appellate authority cannot annul an unchallenged order that has attained finality, and where the statutory forfeiture regime requires duty payment through the PLA for the specified period, discharge through Cenvat credit is not valid.

---