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M/s. Jeevan Diesels and Electricals Ltd. Versus CCE, Pondichery

2016 (3) TMI 438 - CESTAT CHENNAI

Interest not paid and penalty imposed under Section 11AC read with Rule 25 - goods cleared to the DTA unit in the month of January, April, May and August, 2011, without payment of duty - as per assessee they already paid the entire duty demanded and the same was appropriated in the OIO itself - Held that:- The adjudicating authority had rightly computed the interest amount from the due date to till the date of payment in respect of demand for the month of January, 2011. Since the appellants paid .....

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ention and they are liable to pay the total interest of ₹ 17,35,425/-. Since they have already paid the interest of ₹ 15,45,788/-, the differential amount of interest of ₹ 1,87,637/- is liable to be reversed.

As regards penalty, on perusal of the show cause notice, we find the penalty was proposed under Section 11 AC of the CEA as well as under Rule 25 of CER. The adjudicating authority recorded in his findings that they have indicated the duty amount in the column " .....

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nsrea or intention to evade payment of duty so as to invoke penalty under Section 11 AC. Accordingly, the penalty imposed under Section 11AC is not sustainable and liable to be set aside. As regards penalty proposed under Rule 25 of CER, the adjudicating authority imposed penalty by invoking Section 11 AC read with Rule 25 of CER. We hold the appellants are liable for penalty under Rule 25 of CER. - Decided partly in favour of assessee - E/426/2012 - Final Order No. 40408 / 2016 - Dated:- 4-3-20 .....

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cessories etc. and they are entitled upto 50% of the FOB value of exports into DTA sales. They have cleared the goods to their DTA unit in the month of January, April, May and August, 2011, without payment of duty. Accordingly, a show cause notice dated 20.01.2012 was issued to the appellant demanding duty of ₹ 1,12,25,765/- along with the proposal for interest and penalty under Section 11AC of the Central Excise Act, 1944 and also under Rule 25 of Central Excise Rules, 2002. The adjudicat .....

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d with Rule 25 of Central Excise Rules, 2002. Hence, the present appeal. 3. Heard both sides. Shri K.S. Jain, Managing Director of the appellant Company appeared and reiterated the grounds of appeal. He submits that the appellant is contesting only that portion of the interest amount of ₹ 1,87,637/-, which is not paid and Section 11AC penalty. As regards interest he drew attention to page 16 & 17 of the paper book, where they have computed the interest from the due date to the date of .....

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y and August, 2011 and also clearly indicated the duty amount payable but not paid. He drew attention to para-10 of the Order-in-Original and submits that entire amount of duty was paid on various dates and the last installment was paid on 15.04.2012, before passing of the adjudication order. He prays for waiver of penalty as there is no mis-declaration and intention to evade payment of duty and there is no suppression of facts. He further submits that the Company is under BIFR. 4. On the other .....

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to be paid as applicable was @13% and from April, 2011 to 05.04.2012, statutory interest applicable was @18%. Hence, the interest is rightly demanded. Regarding penalty, he submits that the show cause notice was issued on 20.01.2012, whereas the appellants paid the duty on various dates as recorded at para-10 of the OIO from 8th October, 2011 to 05.04.2012. He further submits that this is not the case that the appellants have paid the duty amount before the issue of show cause notice. Therefore, .....

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As regards the demand of interest, we find that the adjudicating authority has confirmed the interest of ₹ 17,35,425/- for the delayed payment of duty and also appropriated an amount of ₹ 15,45,788/- paid by them towards interest. The dispute is only on the differential interest amount of ₹ 1,87,637/-. The appellants contention is that the duty not paid for the month of January, 2011, only 13% interest was chargeable from the due date till the payment of duty and not 18%. On p .....

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ince the appellants paid the amount on 8.10.11, 12/12/2011 and 31.03.12, Revenue has correctly worked out the interest @ 13% upto 31.03.2011 for 54 days and for the remaining period the interest was computed by adopting 18% rate of interest. Whereas, on perusal of the computation done by the appellants at page 16 and 17 of the paper book for the total delayed payment of duty for the month of January, 2011 they have computed by taking the rate of interest @13%. Therefore, we do not find any merit .....

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with Rule 25 of CER and no separate penalty imposed under Rule 25. The appellants main contention is that there is no suppression of facts and there is no intention to evade payment of duty and it is only delayed payment of duty, which they have paid subsequently along with interest before adjudication order. On perusal of the impugned order, we find that the appellant being 100% EOU, regularly filed ER-2 returns, for the month of January, April, May and August, 2011, which was clearly recorde .....

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