RAIL WHEEL FACTORY Vs. COMMISSIONER OF C. EX.

JUDGEMENT

(1.) THIS application is for waiver of pre -deposit and stay of recovery in respect of an amount of Rs. 1.43 crores since quantified by the jurisdictional Asst. Commissioner pursuant to the impugned order of learned Commissioner (Appeals). It is submitted by learned Counsel that, in respect of an earlier period, a refund claim filed by the party for an amount of Rs. 40 lakhs was allowed by the same authority and that the said amount covered by the refund claim was appropriated towards the aforesaid demand of Rs. 1.43 crores pending decision by the Tribunal in the present appeal. Ld. counsel has also placed on record certain decisions of co -ordinate benches to the effect that, on facts similar to those involved in the present case, it was not open to the department to invoke Rule 57CC of the Central Excise Rules, 1944/Rule 57AD of the Central Excise Rules, 2001 for recovery of 8% of the price of the goods (wheels and axels) cleared to the Railways.

(2.) WE have heard learned SDR also, who submits that Rule 57CC or Rule 57AD was not invoked in the subject SCN. It appears from the records that this submission of learned SDR is correct. Though, in its order, the original authority found utilization of an amount of over Rs. 1.75 crores from Cenvat account towards payment of 8% of sale price of exempted goods cleared to Indian Railways during the period of dispute, the operative part of the order demanded an amount of Rs. 17.2 crores under Rule 57AH of the Central Excise Rules, 1944/Rule 12 of Cenvat Credit Rules, 2001/02. Apparently, the nature of this demand is different from that considered by the Tribunal in the cases cited by learned Counsel viz. Wheels and Axel Plant v. Commissioner and Final Order Nos. 1406 -1411/2004 passed by the Tribunal in appeal No. E/276 etc. of 2003. However, learned SDR has no answer to the question why the Asst. Commissioner ventured into appropriation of the refund amount of Rs. 40 lakhs towards the requantified demand of Rs. 1.43 crores. For the present purpose, we have taken into account the above appropriation which was, apparently, done without sanction of law and we hold that the said amount can be retained by the department till final disposal of the present appeal for the purpose of Section 35F of the Central Excise Act. In the result, there will be waiver of pre -deposit and stay of recovery in respect of the balance amount.