SUPREME WOOLLEN MILLS LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) THIS appeal was admitted on 10th August, 2007 on the following questions of law: - -

(2.) AS regards the third question is concerned, perusal of the order of the CESTAT clearly shows that even though the assessee has taken a specific plea regarding the demand being time -barred, the Tribunal has declined to give any decision on the merits merely on the ground that the assessee has paid duty even before the issuance of show cause notice. Perusal of the show cause notice clearly shows that the duty was paid during the investigation as 'deposit' and by the show cause notice, the assessee was called upon to show cause as to why the duty demand should not be confirmed by invoking the extended period of limitation and the amount paid during the investigation should not be adjusted against the differential duty and interest. Thus, the amount deposited being only a deposit, the question of adjusting that amount would arise only if the demand is legally sustainable. Since the Tribunal has not dealt with the contention of the assessee on merits, we set aside the impugned order in so far as it relates to the plea regarding the demand being time -barred and restore the matter to the file of CESTAT for de novo consideration of that issue in accordance with law. The appeal is disposed of accordingly with no order as to costs.