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2015 (10) TMI 1960 - AT - Central Excise


Issues:
1. Imposition of penalty under Rule 27 for not filing ER-1 returns electronically from April, 2010 to December, 2010.

Analysis:
The appellant failed to submit their ER-1 returns electronically from April, 2010 to December, 2010, as required by the Central Excise Rules. The Assistant Commissioner imposed a penalty of Rs. 9,000/- on the appellant for this non-compliance, which was upheld by the Commissioner (Appeals). The appellant contended that the non-filing was due to a systems error with the ACES site, and they had highlighted the issue to the Range Office and ACES Admn. They argued that the manual filing was timely and not deliberate, hence the penalty was unjustified.

The Department argued that despite the account being activated in January, 2011, the appellant did not file the returns electronically for the mentioned period until 19-7-2011, leading to the penalty imposition under Rule 27. However, the Tribunal observed that the non-filing during April, 2010 to December, 2010 was due to a systems error, rectified only in January, 2011. The Tribunal held that the appellant cannot be blamed for the non-electronic filing during that period, as they had timely filed manually and the systems error was beyond their control.

The Tribunal found that the appellant's failure to file electronically after the system error was rectified in January, 2011, was not sufficient grounds for imposing a penalty under Rule 27. Despite the delayed electronic filing in July, 2011, the Tribunal held that penalizing the appellant for the earlier non-compliance during April, 2010 to December, 2010 was unwarranted. Therefore, the impugned order imposing the penalty was set aside, and the appeal was allowed, ruling in favor of the appellant.

 

 

 

 

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