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TMI Blog2012 (2) TMI 423X X X X Extracts X X X X X X X X Extracts X X X X ..... d till the end of the month and balance to be paid in cash before the 5th of the succeeding month. If they do not pay the duty liability to be paid in cash by that appointed date, they can discharge such liability within another 30 days with interest at appropriate rate. If they do not pay such amounts during such grace period they are treated as defaults and are not allowed to utilise the Cenvat credit. During default assessee has to pay excise duty on goods cleared from their factory on each clearance by paying duty through cash, without utilizing Cenvat credit, till such default is made good. 2. During the scrutiny of ER-I returns for the month of October 07, November 07 and December 07 filed by the assessee on 15-1-2008 and the ER ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ulting period is not legally maintainable. They also contest that they had no intention to evade payment of excise duty inasmuch as they had declared the excise duty liability and the fact that they were not able to pay duty liability due to their financial constraints during that period and for such delay in payment they have been already penalised by way of interest that was paid for delayed payments. Therefore they contest that the penalties imposed are not maintainable. 3. The A.R. for Revenue submits that Rule 8(3A) of Central Excise Rules, 2002 clearly provides that if the assessee is in default in payment of excise duty Cenvat credit cannot be utilised and even if such payment is made the goods will be considered as non-duty pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or amounts shown to be paid using Cenvat credit from the date of each clearance to the date on which the default was made good, with interest, and interest on payments made through PLA during such period from date of clearance to date of payment. 5. The Gujarat High Court in the case of CCE v. Saurashtra Cements - 2010 (260) E.L.T. 71 (Guj.) has held that in such situation penalty under Rule 27 of Central Excise Rules only will apply which will be a small amount only. 6. Therefore we order that the appellant should calculate the interest as explained above and deposit the same within eight weeks and report compliance on by 8-5-2012. Subject to deposit of such interest the recovery of the balance dues arising from the impugned or ..... X X X X Extracts X X X X X X X X Extracts X X X X
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