TMI Blog2011 (7) TMI 915X X X X Extracts X X X X X X X X Extracts X X X X ..... Rule 173C and the correct amount of duty required under Rule 173F respectively. - Thus the contravention of Rules 173C and 173F is indisputable in this case. Whether a contravention of the above kind would attract Rule 173Q(1) - As rightly pointed out by the learned counsel, the show-cause notice did not allege that the assessee had contravened any Rule with intent to evade payment of duty - the appellant cannot be allowed to say that the penalty should be set aside on the ground that any particular clause of Rule 173Q(1) was not specifically invoked in the show-cause notice - The offence is purely one of contravention of certain provisions of the Central Excise Rules without mens rea. This situation would call for redetermination of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and hearing both sides, we note that the lower appellate authority upheld the first order-in-original with the modification that the amount of penalty should be limited to Rs.10 lakhs. The appellate authority did not examine the question whether the penalty amount could be deducted from the rebate sanctioned to the assessee. 3. The learned counsel for the appellant submits that the assessee did not violate any of the provisions of the Central Excise Rules with intent to evade payment of duty. At the time of clearance of the goods, its assessable value was determined from the available particulars and duty of excise was paid thereon. As the goods were to be cleared to sister units, the assessable value was determined under Rule 6(b) of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal assessment under Rule 9B. What they chose to do was to self-assess the goods without reference to the proper officer of Central Excise by determining the assessable value incorrectly and short-paying duty, thereby violating the provisions of Rules 173C and 173F. Contravention of these Rules attracted penalty under Rule 173Q(1) and, therefore, the penalty imposed on the appellant to the extent determined by the learned Commissioner (Appeals) is sustainable. 4. In her rejoinder, the learned counsel submits that the proposal to impose penalty on the appellant is not sustainable in law inasmuch as no particular clause of sub-rule (1) of Rule 173Q was invoked in the relevant show-cause notice. In this connection, she has relied on the Hon' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment. The manufacturer could either take prior permission from the proper officer of Central Excise for provisional assessment under bond or other conditions or could resort to self-assessment with the permission of the proper officer under the second proviso to sub-rule (1). In either case, the assessment would be deemed to be provisional assessment. Neither of these situations existed in this case and hence the assessment done by the appellant at the time of clearance of the goods was not provisional assessment as contemplated under Rule 9B. At best, it was a self-assessment under Rule 6(b).The assessable value was not correct. Later on, when the departmental officers visited their factory, the assessee realized their mistake and u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntravened any Rule with intent to evade payment of duty. The finding recorded by the learned Commissioner (Appeals) to the effect that the assessee had contravened the provisions with deliberate intent to evade payment of duty is, therefore, liable to be set aside as it is beyond the scope of the show-cause notice. Therefore, the applicability of clause (d) of sub-rule (1) of Rule 173Q is ruled out. Reverting to clause (a) of the sub-rule, we find that this provision gets attracted on the facts of this case inasmuch as the assessee removed excisable goods in contravention of Rule 173C (by determining incorrect assessable value) and Rule 173F (by short-paying duty). The original authority imposed a hefty amount of penalty which was reduced t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es inasmuch as 'they had cleared their goods at incorrect, wrong and lower assessable value thereby paying less duty than what was due to the department for the period 1998-99 and 1999-00'. From the allegation raised in the show-cause notice read with the annexures thereto, it would appear that Rule 173Q(1) was invoked for contravention of the aforesaid provisions. Thus clause (a) of sub-rule (1) of Rule 173Q was impliedly invoked in the show-cause notice. Therefore, the appellant cannot be allowed to say that the penalty should be set aside on the ground that any particular clause of Rule 173Q(1) was not specifically invoked in the show-cause notice. Any such liberal view, as expressed by the learned counsel, would defeat the very purpose ..... X X X X Extracts X X X X X X X X Extracts X X X X
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