Madan B. Lokur, J.

1. This appeal has been filed by the Revenue under Section 35-G of the Central Excise Act, 1944 (for short the Act). According to the Revenue, a substantial question of law arises out of the order dated 18.6.2004 passed by the Customs, Excise & Service Tax Appellate Tribunal, East Zone Bench, Calcutta (for short CESTAT) in Appeal No. EDM-472/2003.

2. Broadly, the Assessee had set up a unit for the purposes of manufacturing tea. In terms of Notification No. 33/99-CE dated 8.7.1999 exemption from duty was granted to units set up in the North East after 24.12.1997 and also to existing units making an expansion of 25% or more of the installed capacity. According to the Assessee, it had increased its installed capacity by more than 25% and therefore, claimed the benefit of Notification No. 33/99-CE dated 8.7.1999.

3. The entitlement of the benefit to the Assessee came to be considered by the Assistant Commissioner of Central Excise, Silchar. By his order dated 29.4.2002 it was held that the Assessee is eligible for the exemption under Notification No. 33/99-CE dated 8.7.1999. It was also held that the Assessee had completed the expansion work on 30.9.2000 and therefore, the benefit would be available to the Assessee only with effect from 1.10.2000. This order has since attained finality inasmuch as it has not been challenged by the Revenue.

4. Based on the aforesaid order dated 29.4.2002, a consequential provisional sanction order was issued in favour of the Assessee on 30.4.2002 for an amount of Rs.16,09,585/- as admissible refund for the period under consideration. We are told by learned Counsel for the Assessee that the amount has since been received by his client.

5. The Revenue thereafter issued a notice under Section 11A of the Act on 6.8.2002 seeking recovery of an amount of Rs.16,09,687/-. It was alleged in the notice that the Assessee had played some kind of a fraud for obtaining the refund. At this stage, it may be only be stated that the Revenue did not invoke the extended period of limitation under the proviso to Section 11A of the Act.

6. The Assessee replied to the show cause notice and an order was passed by the Commissioner of Central Excise, Shillong on 30.9.2003 confirming the demand of Rs.16,09,687/- made under Section 11A of the Act since that amount had erroneously been refunded to the Assessee. It was also ordered that interest on the amount should be paid by the Assessee.

7. Feeling aggrieved, the Assessee preferred an appeal before the CESTAT which passed an order dated 18.6.2004 which is under consideration in this appeal. The CESTAT came to the conclusion that the appropriate course of action for the Revenue would have been to challenge the initial order dated 29.4.2002 passed by the Assistant Commissioner of Central Excise, Silchar whereby the Assessee was given the benefit of Notification No. 33/99-CE dated 8.7.1999. It was held that the Commissioner of Central Excise could not exercise his power under Section 11A of the Act to re-open a proceeding that had already terminated and was not earlier challenged by the Revenue.

8. The CESTAT eventually held that since the Revenue had failed to challenge the order passed by the Assistant Commissioner, Silchar by invoking the revisional power conferred by Section 35E(2)of the Act, the order dated 29.4.2002 had attained finality. Following the decision of the Madras High Court in Ponds (India) Ltd. v. Assistant Collector of Excise, Madras 1994(73) ELT 272 (Mad.) it was held that resort to Section 11A of the Act was not permissible. As mentioned above, the Revenue was dissatisfied with this order of the CESTAT and has sought to raise a substantial question of law before us.

9. On 20.4.2009, a Division Bench of this Court took the view that the appeal filed by the Revenue ought to be allowed and the judgment and order dated 18.6.2004 passed by the CESTAT was liable to be set aside. The Division Bench also directed re-commencement of the proceeding