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Vipul-S Plasticrafts P. Ltd. Versus Commissioner of Central Excise, Pune I

2016 (2) TMI 766 - CESTAT MUMBAI

Duty appropriated against the duty defaulted for the month of October 2007 - demand along with interest and penalty - Subrule (3A) of Rule 8 of the Central Excise Rules, 2002 - Held that:- It is a fact that the show-cause notice, Order-in-Original and Order-in-Appeal are based on the violation of Rule 8(3A) of the Central Excise Rules, 2002 which require the payment of duty only through account current in case of violation of payment of duty in time as prescribed in Rule 8. As submitted by the l .....

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y the Hon'ble High Court of Gujarat, Madras and Punjab & Haryana, set aside the impugned order by allowing the appeal of the appellant with consequential relief, if any. - Appeal No. E/175/11- Mum - A/85458/16/SMB - Dated:- 27-1-2016 - MR. S.S. GARG, MEMBER (JUDICIAL) For the Petitioner : Shri T.C. Nair, Advocate For the Respondent : Shri S.V. Nair, AC(AR) ORDER This appeal is directed against Order-in-Appeal No. P-I/RKS/202/2010 dated 26.10.2010 by which he has upheld the Order-in-Original. 2. .....

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ial crisis they could pay only part of the duty liability from Cenvat account. The balance amount payable through account current remained unpaid mainly due to heavy financial crunch and recession in the market and non-receipt of payment from customers. This short payment of duty was reflected in monthly returns filed with the department. Thereafter the show-cause notice was issued dated 17.10.2010 by the Additional Commissioner of Central Excise, Pune I asking the appellant to show-cause why du .....

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he Order-in-Original. 3. Ld. Counsel for the appellant submitted that the order of the Commissioner (Appeals) is contrary to the law, justice, equity and is liable to be set aside. He further submitted that the provisions of Rule 8(3A) of the Central Excise Rules, 2002 which require payment of duty only through account current and prohibits payment of duty through Cenvat account have been struck down as unconstitutional by the Hon'ble High Court of Gujarat, Madras and Punjab & Haryana by .....

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e show-cause notice, Order-in-Original and Order-in-Appeal which are based upon rule 8(3A) cannot survive and are liable to be set aside as held by the Hon'ble Gujarat High Court in para 4 of the judgment in Shreeji Surface Coatings P. Ltd. (supra). In para 4, the Hon'ble High Court of Gujarat has observed as under:- 4. When the entire showcause notice, order in original and appellate order are based on Sub-rule (3A) of Rule 8, the portion of which came to be struck down, such orders can .....

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thout utilization of the Cenvat Credit. 5. Ld. Counsel for the appellant further submitted that in view of the law down by various High Courts, imposition of penalty under Rule 25 of Central Excise Act, 2002 is totally unsustainable in law. He further submitted that the Tribunal in the following decisions has laid down that for the contravention of said rule 8 no penalty can be imposed under Rule 25 and only a penalty of ₹ 5000/- can be imposed under Rule 27. He cited the following authori .....

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