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2016 (3) TMI 438 - CESTAT CHENNAIInterest not paid and penalty imposed under Section 11AC read with Rule 25 - goods cleared to the DTA unit in the month of January, April, May and August, 2011, without payment of duty - as per assessee they already paid the entire duty demanded and the same was appropriated in the OIO itself - Held that:- The adjudicating authority had rightly computed the interest amount from the due date to till the date of payment in respect of demand for the month of January, 2011. Since the appellants paid the amount on 8.10.11, 12/12/2011 and 31.03.12, Revenue has correctly worked out the interest @ 13% upto 31.03.2011 for 54 days and for the remaining period the interest was computed by adopting 18% rate of interest. Whereas, on perusal of the computation done by the appellants at page 16 and 17 of the paper book for the total delayed payment of duty for the month of January, 2011 they have computed by taking the rate of interest @13%. Therefore, we do not find any merit in the appellant's contention and they are liable to pay the total interest of ₹ 17,35,425/-. Since they have already paid the interest of ₹ 15,45,788/-, the differential amount of interest of ₹ 1,87,637/- is liable to be reversed. As regards penalty, on perusal of the show cause notice, we find the penalty was proposed under Section 11 AC of the CEA as well as under Rule 25 of CER. The adjudicating authority recorded in his findings that they have indicated the duty amount in the column "duty payable" but the column under “duty paid” was left blank. We find that the entire case is basically of delayed payment under Rule 8 and the consequential demand by the department. We find that the show cause notice was issued on 20.01.2012. Before the issue of SCN itself, the appellant paid ₹ 25,00,000/-, ₹ 20,00,000/- was proposed for appropriation in the SCN and the balance amount was paid with interest before issue of adjudication order. Therefore, we hold that there is no mensrea or intention to evade payment of duty so as to invoke penalty under Section 11 AC. Accordingly, the penalty imposed under Section 11AC is not sustainable and liable to be set aside. As regards penalty proposed under Rule 25 of CER, the adjudicating authority imposed penalty by invoking Section 11 AC read with Rule 25 of CER. We hold the appellants are liable for penalty under Rule 25 of CER. - Decided partly in favour of assessee
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