Order Date: 08 June 2022

Facts:

• The appellant M/s Bayer Vapi Pvt Ltd, had deposited the entire duty amount and only penalty and interest was left out. However, the appellant had preferred an appeal before the CESTAT which was admitted and pending. 
• Revenue had order appropriation towards penalty and interest from the sanctioned rebate claim during the period the demand case was pending before the tribunal.
• The Appellant contends that the demand could not have been appropriated from the sanctioned rebate claim. At the relevant time, the appellant was required to pay only 7.5% or 10% as the case may be for filing appeal and remaining amount stand stayed. In the present case, the appellant had paid the entire duty amount therefore, the remaining amount could not have been recovered from the sanctioned rebate claim. 

Issue:

• Whether the revenue is correct in appropriating the demand towards penalty and interest corresponding to a confirmed demand from the sanctioned rebate claim during the period the demand case was pending before the tribunal?

Order:

• The Tribunal find that the appellant, is required to pay only 7.5% or 10% as the case may be. On payment of such amount, entire remaining amount stand stayed if this be so, out of the remaining amount no recovery can be made. 
• As stated above, the appellant not only paid 7.5%/10% but the entire duty therefore, in terms of Section 35F read with Board Circular No. 984/8/2014-CX., dated 16-9-2014, the revenue should not have recovered the amount of penalty and interest by way of appropriation from the sanctioned rebate claim. Additionally, the appellant’s demand case got settled under ‘SVLDRS-2019’, for this reason also, no amount shall be allowed to be appropriated. 
• Therefore, the impugned order is set aside and appeal is allowed.