UNION OF INDIA Vs. TRIVENI CONDUCTORS LTD

JUDGEMENT

(1.) The respondent had filed an application before the Deputy Commissioner, Central Excise and Customs praying for a direction to refund an amount of Rs. 57,320/- on the ground that the order passed against his interest was set aside in appeal and as he had already deposited the amount then on account of grant of appeal, the amount deposited under protest be directed to be refunded to the respondent. The application was allowed vide original order No. 248/DC/Refund/2005 passed on 8-7-2005 but however the Deputy Commissioner observed that sum of Rs. 7,626/- be appropriated towards the demand made in view of the order in original No. 44/DC/Demand/2005 dated 15-5-2005 and rest of the amount Rs. 49694/- be appropriated against the order in original No. 46/DC/Demand/2005 dated 19-5-2005. The respondent being aggrieved by that direction to appropriate the entire amount of Rs. 57,320/- preferred appeal No. IND/I/467/205 to the Commissioner (Appeals) Customs and Central Excise. Learned Commissioner (Appeals) was pleased to reject the appeal as time barred but however observed that as the demand raised under Order No. 44/2005 dated 18-5-2005 and order No. 46/2005 dated 19-5-2005 were complied with by the respondent and the amount was deposited in June, 2005 and August, 2005, the Department may still consider the matter and issue a cheque in sum of Rs. 57,320/-. The observations were not palatable to the Department, therefore, they preferred Excise Appeal No. E/502/06-SM (BR). The appeal came to be dismissed by the Vice President vide its order dated 20-11-2007 as the Vice President was pleased to observe that it would not be open to the Authority to challenge the observations and that Commissioner was justified in making such observations. The Department is still aggrieved and has come to this Court. On 24-6-2008, the appeal has been admitted for hearing the parties on the following substantial questions of law :-

(2.) Whether the Commissioner (Appeals) has traveled beyond his legitimate jurisdiction which was otherwise not available to him ?

(3.) Shri Nair, learned counsel for the respondent, on the other hand, submitted that the Government Departments are supposed to be honest and they can not take undue advantage on technicalities. It is submitted by him that the Department would be entitled to appropriate the amount provided the liability stands. According to him if the liability is already discharged by depositing the amount then the Department cannot be permitted to appropriate the amount which was to be refunded to the respondent and the Department at the same time cannot retain the amount which was deposited in compliance to the order No. 44/DC-2005-46/DC-2005.