Demand of Excess Refund Amount of Custom Duty on Inputs Lost in Fire based on Mere presumption: CESTAT quashes Order [Read Order]

The Chandigarh bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) quashed the demand for an excess refund amount of customs duty on inputs lost in fire based on mere presumption. 

Comfort Polymers Pvt. Ltd, the appellant assessee was the manufacturer of water storage tanks and Foam Sheets chargeable to central excise duty and availed CENVAT credit of duty paid on inputs used in or concerning the manufacture of their final products. 

The assessee appealed against the order passed by the Commissioner (Appeals) for confirming the recovery of the excess refund amount along with interest at the applicable rate. 

A. S. Gill, the counsel for the assessee contended that the impugned order was not sustainable in law as the same had been passed without properly appreciating the facts and the law and the binding judicial precedents on the same issue. 

Further submitted that the demand of excess refund amount was without any basis and the show cause notice was vague and nowhere mentioned in the show cause notice as to in which month excess refund was taken or granted and was based on ill-founded assumptions and presumptions. 

Also stated that no refund was taken by the assessee as per the show cause notice and therefore there was no question of excess refund and the decision made by the lower authorities was not as per the law and liable to be deleted. 

Shivani, the counsel for the department relied on the decisions of lower authorities and contended that the demand of excess refund amount was as per the law and liable to be sustained. 

The Bench observed that no such refund was taken by the assessee as alleged by the department and thus there was no question of excess refund which was to be paid to the department. 

The two-member bench comprising S.S Garg (Judicial) and Anjani Kumar (Technical) quashed the demand for excess refund amount while allowing the appeal filed by the assessee.

To Read the full text of the Order CLICK HERE

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