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2015 (10) TMI 1542 - CESTAT NEW DELHI

2015 (10) TMI 1542 - CESTAT NEW DELHI - TMI - Denial of CENVAT Credit - failure to discharge the full duty liability - payment of that duty through PLA along with interest - Held that:- Requirement of this sub-rule to pay duty without utilizing CENVAT Credit during the period of delay in discharge of duty liability for a particular month, which is beyond the period of one month from the due date, is unconstitutional; and though Hon'ble Madras High Court in the case of Unirols Airetx Vs. Assistan .....

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beyond the period of one month from due date, the provisions of Rule 8 (3A) become applicable and the duty on the goods cleared during this period is required to be paid without utilizing the CENVAT Credit, the High Courts have not gone into the question of constitutionality of this provision. - When sub-rule 3 (A) of Rule 8 of the Central Excise Rules, 2002 has been struck down as unconstitutional by two High Courts, in our view, Commissioner's order based on the Rule 8 (3A) would not survive. .....

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; 7,10,590/- through CENVAT Credit account and one lakh through PLA and as such there was short payment of ₹ 2 lakh. It is not in dispute that at that time, the CENVAT Credit balance was about 3,27,000/- and according to the appellant, the failure to discharge the full duty liability was due to clerical mistake. 2. It is also not in dispute that appellant realized from mistake and paid the balance amount of duty on 19/12/2012 along with interest. This delay in discharge of full duty liabil .....

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Credit. Since this forfeiture period had started from 6/6/2012 which continued till 18/12/2012 and since during this period, the appellant had paid certain duty by utilizing the CENVAT Credit, a show cause notice was issued to the appellant for payment of that duty through PLA along with interest, and also for imposition of penalty on them as according to the provision of Rule 8 (3A) clearance of goods during the forfeiture period by payment of duty through CENVAT Credit account is deemed to be .....

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Rules. While imposing lower penalty, the Commissioner in para 19.2 of the order observed that he has taken into consideration the appellant's plea that in April, 2012 they had sufficient balance in the CENVAT Credit account to discharge the pending duty liability of ₹ 2 lakh for that month, but the same was not done due to clerical mistake and as such there was no intention of the appellant to evade the payment of the duty. 3. Against this order of the Commissioner, this appeal has bee .....

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ring the period of delay in discharge of the monthly duty liability for a particular month which is beyond the period of one month from the due date, the assessee is required to pay the duty consignmentwise and without utilizing the CENVAT Credit and has held that this provision requiring the payment of duty without utilizing the CENVAT Credit during the forfeiture period is unconstitutional; that though Hon'ble Madras High Court in the case of Unirols Airtex Vs. Assistant Commr. Of Central .....

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unconstitutional, the impugned order of the Commissioner which is based on the provisions of Rule 8 (3A) would not be sustainable. He, therefore, pleaded that impugned order is not correct. 6. Shri M.S. Negi, learned DR defended the impugned order by citing the judgments of Hon'ble Madras High Court in the cases of Unirols Airtex Vs. Assistant Commr. Of Central Excise-Coimbatore (Supra), Commr. of C. Ex. 'Chinnai-III Vs. A.R. Metallurgical Pvt. Ltd. 2014 (306) ELT 418 (Mad.) and also a .....

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hat there is no infirmity in the impugned order. 7. We have considered the submissions from both the sides and perused the records. 8. The only point of disputes in this case is as to whether during the period from 6/6/2012 to 18/12/2012, i.e., period of delay in discharge of duty liability for April, 2012 which is beyond the period of one month from the due date, the appellant were liable to pay the duty in respect of the goods cleared during this month only through PLA without utilizing the CE .....

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