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2013 (9) TMI 539 - CESTAT NEW DELHICompounded levy scheme - manufacture of pan masala / pan masala containing tobacco commonly known as gutkha - Interpretation of Statute - Whether or not Notification No. 42/2008-C.E. superseded the Notification No. 38/2007-C.E. by implication or both the Not ifications were simultaneously operating during the period - Held that:-The assessee-appellant-respondent were liable to pay differential of excise duty based upon different rates in excise duty on account of enhancement of rate of excise duty. The first proviso to Clause 2 of procedure and conditions detailed in Notification No. 38/2007-C.E. provided that in case of revision in the rate of excise duty the same shall be recalculated on the basis of revised rates from the date of revision and the liability of duty leviable on the manufacturer of the specified goods from that date shall not be discharged unless differential duty is paid and in case the amount of duty so recalculated was less than the sum paid then the differential amount shall be refunded to the manufacturer - the excise duty rates had been enhanced vide Notification No. 42/2008-C.E. Two notifications were so inconsistent with or repugnant to each other that both cannot be stand together and such repugnancy arises from different criteria for charging excise duty - If both the Notifications were allowed to operate simultaneously this will obviously create an anomaly for the reason that it would discriminate between two sets of manufacturers of pan masala and gutkha, one who earlier to issue of the Notification No. 42/2008-C.E. were operating under Notification No. 38/2007-C.E. and others who were operating under normal scheme of payment of excise duty under Section 3 of the Excise Act. Assesses were operating under Notification No. 38/2007-C.E. issued under Rule 15 of Central Excise Rules, 2002 - The Notification provided for optional compounded levy scheme in respect of specified excisable goods i.e. pan masala and pan masala containing tobacco (gutkha) which provided prescribed rates of duty per pan masala/gutkha packing machine per month - Despite of issue of above referred Notification No. 29/2008-C.E. (N.T.) and Notification No. 52/2008-C.E., earlier Notification No. 38/2008-C.E. under which the assessees were operating, was not superseded or rescinded. However, on 16-7-2008 Notification No. 44/2008-C.E. was issued rescinding the Notification No. 38/2008-C.E. Penalty U/s 11AC – Interest - Penalty imposed on the appellant was not justified because the question of interpretation regarding applicability of Notification No. 38/2007-C.E. or Notification No. 42/2008-C.E. was involved and therefore, no intention to evade payment of excise duty can be inferred. - Penalty waived.
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