ORDER
T.K. Jayaraman, Member (T)
1. This is an appeal filed by Revenue against the OIO No. 01/2001 dated 20.12.2000 passed by the Commissioner of Central Excise, Mangalore.
2. The issue involved is whether the appellants are liable to pay the amount collected by them in excess of CV Duty paid in respect of HSD, FO Motor Spirit and SKO imported by them during the period from 1.3.1994 to 30.9.1996. The appellants clear indigenous and imported petroleum products. It was noticed that during the period from 1. 3.1994 to 30.9.1996. they collected 3,45,31,350/- from their customers in excess of the CV duty paid on them. The Revenue initiated proceedings to demand this duty under Section 11D. The adjudicating authority held that Section 11D is applicable only to excisable goods in view of the retrospective amendment w.e.f. 20.9.1991. He has also relied on the CEGAT’s decision in the case of HPCL, Hyderabad v. CCE, Hyderabad 2002 (149) ELT 1294 (Tri. – Chennai) wherein it has been held that provisions of Section 11D of the Act are applicable only to excisable goods and not applicable to imported petroleum products. The Revenue has filed an appeal against the impugned order on the following grounds:
(i) However, it is observed that in terms of Section 11D, every person who has collected any amount from the buyer of any goods in any manner, as representing duty of excise shall forthwith pay with the amount so collected to credit of the Central Government. In the instant case it appeared that the excess duty collected is rightly demanded from the assessee in terms of the Section 11D of CEA 1944.
(ii) Further, the assessee should have issued invoice other than Rule 52A invoices if they were traders of customs duty paid goods and if they issued invoices to Modvat users, they should have issued invoices under Rule 57GG. Since all the invoices issued by the assessees are issued under Rule 52A and there is every possibility that the end user might have availed the modvat credit which is prima facie rightly available to them. Whereas the fact remains that the goods have not suffered Central Excise duty. This ultimately might lead into a situation of passing on the modvat credit without actually paying Central Excise duty to the exchequer and the interest of revenue will be doubly jeopardized.
3. Smt. Shobha L. Chary, learned JCDR appeared on behalf of the appellants and Shri Balamurugan and Shri V. Ramakrishnan, representatives of IOC appeared on behalf of the respondents.
4. The learned JCDR urged that the respondents collected CV duty in excess of what they had paid to the exchequer through invoices under Rule 57A. Even though the goods are imported since they are liable to pay countervailing duty, which is equal to the Central Excise duty, Section 11D is applicable. It was also contended that there is a possibility of buyers of petroleum products taking modvat on the duty collected from them inspite of the fact that the respondent had not paid the same to the Government. She could not explain why the case law relied on by the Commissioner is not applicable to the present case.
5. Shri K. Balamurugan submitted that since HSD and Motor Spirit are only sold to the retailers, there no possibility of taking any modvat credit. As regards Superior Kerosene Oil, the same is meant for Public Distribution system. In this case also, there is no apprehension of taking modvat credit. As regards fuel oil, it was submitted that they have paid more customs duty-than what they have collected from the customers. It was also urged that the case is squarely covered by CEGAT’s decision relied on by the Commissioner.
6. On careful consideration of the entire issue, we find that the Commissioner has carefully analyzed each ingredient of Section 11D in para 8 of his OIO. Prior to the amendment of Section 11D by the Finance Act 2000, the expression used was “Every person who has collected any amount from the buyer of any goods”. However, after the retrospective amendment w.e.f. 20.9.1991, the expression used is ” Every person who is liable to pay duty under the Act or Rule made thereunder and has collected any amount in excess of duty assessed or determined and paid on any excisable goods”. From the amendment it follows that even if excess duty has been collected, Section 11D will come into play only if the goods are excisable. Imported goods cannot be held to be excisable. Hence, as rightly held by CEGAT, Section 11D is not applicable to them.
7. In view of the above findings, the Revenue’s appeal is dismissed.
(Pronounced in open Court on 16.12.2004)