2003 (9) TMI 675 - AT - Central Excise

Summary

Issues: Imposition of penalty for delay in payment under Rule 96ZP

Analysis:
The appeal in this case pertains to the imposition of a penalty of Rs. 5,000 for a delay in payment of amounts due by an assessee engaged in the manufacture of iron and steel products. The appellant argued that a change in parameters necessitated relief from the penalty, as the amount with interest had already been paid. It was contended that the rule under which the penalty was imposed was not mentioned, and there was no penalty clause under Rule 96ZP in 1997. On the other hand, the Departmental Representative pointed out that Section 11AC and Rule 173Q were involved in the Show Cause Notice, and the absence of mentioning a specific rule in the order would not invalidate the penalty imposed.

Upon consideration, it was observed that Rule 96ZP(I)(c) Proviso for the relevant period from September 1997 to March 1998 clearly stipulated the penalty provision for delayed payments. The order-in-original indicated that the remaining amounts were paid on 31-3-1998, whereas the Show Cause Notice was dated 6-1-1998. Since the total amount had been paid with interest by the due date, no penalty under Rule 96ZP(I)(c) Proviso was warranted. Consequently, the penalty of Rs. 5,000 was set aside as the payment was made before the specified deadline in April 1998. Therefore, the order of penalty was overturned, and the appeal was allowed.