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2015 (7) TMI 1104 - CESTAT NEW DELHI

2015 (7) TMI 1104 - CESTAT NEW DELHI - 2016 (344) E.L.T. 636 (Tri. - Del.) - Liability of interest - Invokation of second proviso to Rule 9 read with Section 11AA of the Central Excise Act, 1944 - Delay in payment of duty - factory was not in operation during the period - duty abatement was allowed by the department - Held that:- since the production activity was suspended on 01.06.2013 and continued till 22.06.2013, there was no occasion for payment of duty in advance on 05.06.2013 for the whol .....

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ratibha Processors vs UOI [1996 (10) TMI 88 - SUPREME COURT OF INDIA], wherein it has been held that the interest is compensatory in character and is imposed on the assessee who has withheld payment of any tax as and when it is due and payable. The impugned order is set aside. - Decided in favour of appellant - Excise Appeal No. E/51382/2014-E[SM] - Final Order No. 54019/2015 - Dated:- 3-7-2015 - Mr. S.K. Mohanty, Member (Judicial) For the Appellant : Mr. Prabhat Kumar, (Advocate) For the Respon .....

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t, 1944. 2. Rule 6 of the said rules provides that a manufacturer has to file a declaration in the prescribed form, declaring inter-alia, the number of packing machines installed in the factory. Manner of payment of duty is contained in Rule 9 of the said rules, which mandates that the monthly duty payable on notified goods shall be paid by the 5th day of the said month. Interest liability for non-payment of the amount of duty within the stipulated time is contained in the second proviso to Rule .....

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duce the notified goods during any continuous period of fifteen days or more, Rule 10 of the said rules provides for abatement from the duty already paid in advance for the said month. 3. In the present case, the factory of the appellant was not in operation during the period from 01.06.2013 to 22.06.2013. Thus, in terms of Rule 10 of the said rules, the appellant had applied for abatement of duty, which was considered by the Jurisdictional Central Excise Authorities. Out of total duty of ₹ .....

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djudicating authority, since the statute requires that the duty should be deposited on the 5th day of the relevant month and the appellant deposited the duty on 24.06.2013, interest liability is automatic, which is required to be paid by the appellant. The interest liability confirmed in the adjudication order was appealed against by the appellant before the Ld. Commissioner (Appeals). The appeal was disposed of vide the impugned order, wherein the period of delay was reduced from 19 to 18 days, .....

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mmencement of the production activities i.e. on 24.06.2013. According to the Ld. Advocate, since there was no occasion/scope for payment of duty on 5th of June' 2013, and the amount was paid immediately on resumption of production activities, the interest liability cannot be fastened on the appellant. To support such views, the ld. Advocate contends that instead of the second proviso of Rule 9, the third proviso contained therein is applicable to the facts of the case, according to which, th .....

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irement of Rule 6 of the rules, since the appellant had informed the Department regarding the number of pacing machines installed in the factory by way of filing statutory declaration, the duty liability was required to be discharged on the stipulated time frame, irrespective of the fact as to whether the machines were in operation or not. It is his further submission that second proviso to Rule 9 clearly provides that in absence of non-payment of the duty within the stipulated date i.e. the 5th .....

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formation furnished by the appellant. 8. It is an admitted fact that based on the declaration filed by the appellant that the factory was closed from 01.06.2013 to 22.06.2013, the Jurisdictional Central Excise Authorities have allowed the abatement as claimed under Rule 10 of the said Rules. The requirement of payment of duty by 5th of the same month as contemplated under Rule 9, denotes that the packing machines installed in the factory shall be operational throughout the month. In case of non- .....

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.06.2013, in my opinion, there was no occasion for payment of duty in advance on 05.06.2013 for the whole month of June' 2013, for the reason that the appellant might not haveaware as to how long the factory will remain un-operational. On resumption of the production activity on 23.06.2013, since the appellant promptly deposited the duty on the very next day, i.e. on 24.06.2013, in my opinion, there was no delay in payment of duty and therefore the interest liability cannot be fastened on th .....

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