Adjustment of duty short-paid against excess duty paid is permissible after finalisation, with remand for precise computation.

Clarifies that where provisional assessments are finalised, amounts of duty found short-paid may be adjusted against duty paid in excess for the same assessment period; the statutory framework does not prohibit such adjustment. The note identifies that if the appellant has promptly effected adjustment after finalisation, that adjustment is permissible. A distinct arithmetic dispute over the quantum of short-paid duty was held not suitable for resolution on appeal and is remitted to the original adjudicating authority for de novo computation with observance of natural justice and opportunity to the affected party.

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Issues: Whether duty short-paid in provisional assessments can be adjusted against excess duty paid for the same period.

Analysis: The issue arises from provisional assessments finalized under Rule 7 of the Central Excise Rules, 2002 and determination of assessable value under Section 4 of the Central Excise Act, 1944 for products in Chapter 27 of the First Schedule to the Central Excise Tariff Act, 1985. The Tribunal examined whether the statute permits adjustment of amounts of duty short-paid against amounts of duty paid in excess for the same assessment period. Earlier orders of the Tribunal and an order of the Commissioner (Appeals) in identical factual matrices were considered, including a precedent where short-paid duty was held adjustable against excess paid duty. The Tribunal noted that the provisional assessments were finalized and the appellant promptly adjusted short-paid duty against excess duty; there is no statutory prohibition to such adjustment in the context of finalized provisional assessments. A separate arithmetic dispute about the correct quantum of short-paid duty was raised for the first time on appeal; the Tribunal found that arithmetical accuracy should be determined by the original authority and remanded that limited computation issue for fresh adjudication with observance of natural justice.

Conclusion: The Tribunal allows the appeal to the extent that adjustment of short-paid duty against excess paid duty is permissible and remands the limited question of correct computation of the short-paid duty to the original authority for de novo adjudication. The decision is in favour of the assessee.

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