Home Case Index All Cases Central Excise Central Excise + HC Central Excise - 2015 (4) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2015 (4) TMI 246 - HC - Central ExciseImposition of penalty - Whether imposition of penalty under Rule 96ZO(3) of the Central Excise Rules, 1944 equal to the amount of duty not paid during the stipulated period is mandatory - Held that:- Assessee, engaged in the manufacturing of M.S. Ingots/Billets of Non Alloy Steel, was in default of Rule 96-ZO(3) of the Rules for delay in depositing the duty, which was paid on later dates. The show cause notices were issued under Rule 96-ZO(3) and 209 of the Rules, in which the demand of interest amount of ₹ 24,095/- was liable to be paid, at the same time, attracting violation of the Rule 96-ZO(3) of the Rules, a penalty of ₹ 57 lacs was imposed by the order-in-original. - Commissioner(Appeals-I), reduced the penalty to ₹ 5 lacs. The Customs, Excise & Service Tax Appellate Tribunal, New Delhi(CESTAT), vide its previous judgment, relying upon Mool Chand Steels Pvt. Ltd. Vs. CCE, Meerut, (2004 (11) TMI 563 - CESTAT NEW DELHI), reduced the penalty to an amount of interest, at ₹ 26,000 In the judgments cited by the Central Excise Department, the question of vires of the Rules was not considered. The judgments were rendered in view of Dharmendra Textile Processors' case(2008 (9) TMI 52 - SUPREME COURT ), which was later on explained in Union of India Vs. Rajasthan Spinning & Weaving Mills(2009 (5) TMI 15 - SUPREME COURT OF INDIA), and in which, it was clearly stated by the Supreme Court that the judgment in Dharmendra Textile Processors' case(2008 (9) TMI 52 - SUPREME COURT ), was relevant only for the purpose of Section 11AC of the Central Excise Act, and that so far as several other statutory provisions are concerned, the Court is not making any observations. - once the Rule has been declared ultra vires by the High Court, having competent jurisdiction to provide such determination, the same Rule cannot be relied on for the purposes of imposing penalty, equal to the amount of central excise duty of the relevant period. - Decided in favour of the assessee.
|