2016 (2) TMI 327

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....mmissioner of Central Excise (Appeals), & Customs, Noida whereby the appropriation of the rebate amount relating to the period January and February 2013 as well as December 2012, has been made against the liability for interest relating to prior period of their Bombay unit, which have been upheld by the impugned order. 2. Brief facts are that the appellant manufactures and exports tractors and its part having its manufacturing unit at Noida and is registered under the provisions of Central Excise Act, being entitled to rebate under rule 18 of the Central Excise rules read with notification number 19/2004 - CE dated 6/9/2004 applied for refund vide 5 different refund claims which were adjudicated vide order-in-original Nos. 471- 473/R/AC/....

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....of Board's Circular number 208/42/96 - CX dated 2/5/1996 from the assessee by way of adjustment and appropriation of any money owing to such person under the jurisdiction of Division IV of Central Excise, Noida. Accordingly the adjudicating authority observed that section 142 of the Customs Act as made applicable to Central Excise Act in the like matters read with Notification No. 68/63-CE dated 4/5/1963, as amended, in such matter, according to which, the proper officer may deduct or may require any other officer of the Customs to deduct the amount so payable from any money owing to such person which may be under the control of the proper officer or such other officer of the Customs/Central Excise. And accordingly, it was ordered that ....

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....of the full amount of principle duty payable, as crystallized vide order of the Honourable Supreme Court in August 2012 and pursuant thereto the appellant challenged those letters demanding interest in writ petition number 3901 of 2013 before the Honourable Bombay High Court which was filed on 18/4/13. The said writ petition was entertained and the same was finally decided in favour of revenue vide order dated 29/9/2014. He vehemently argued that on the date of adjustment made by the adjudicating authority, the said liability of interest was sub-judice and could not have been said to be crystallized and as such the adjustment is bad as only demands which are attained finality and/or crystellized can be collected by way of certificate procee....

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....r, reliance is placed on the ruling in the case of KEC International Ltd. Vs. Commissioner 2014 (310,) ELT 615, where the amount of interest was adjusted against the amount of rebate, this Tribunal, held that it is not permissible to adjust unconfirmed demand of interest and further for recovery of any demand from an assessee the principles of natural Justice are to be followed, which includes issuance of show cause notice, affording reasonable opportunity to the assessee to put forward its case. The ld. Counsel also points out from the final order dated 29.9.14, the Honourable Bombay High Court in their order observed that "mere ommission to mention of interest by the adjudicating authority in its order dt. 31.01.2002 will not entitle to t....