TMI Blog2017 (10) TMI 846X X X X Extracts X X X X X X X X Extracts X X X X ..... 2003-04 to 2006-07 (upto 12/2006). Show cause notice, dated 13.06.2007, has been issued, seeking for an explanation for imposing duty, interest and penalty. All the issues, including invoking of extended period, have been considered by the adjudicating authority in Order-in-Original, dated 11.09.2007. When the Tribunal has remitted the matter to the adjudicating authority, to re-do the matter afresh and to pass a reasoned order, on all legal and factual plea, further directions that no penalty should be imposed on the respondent, upon re-adjudication, would be amount to pre-judging the issue, by the Tribunal, on the issue of penalty. When the entire matter is directed to be adjudicated afresh, there cannot be a finding by the Tribunal, on one of the issues, raised in the show cause notice, viz., penalty. Order of the Tribunal is contrary to the exercise to be done, afresh by the adjudicating authority and the same requires to be set aside. Final order directing the matter to be adjudicating authority to re-do the adjudication, is sustained. Appeal allowed in part. - C. M. A. No. 2687 of 2017 - - - Dated:- 4-10-2017 - S. Manikumar And R. Suresh Kumar, JJ. For the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act and also the penalty of ₹ 15,00,000/-, under Rule 25 of Central Excise Rules, 2002. 5. After due process, the adjudicating authority, vide Order-in-Original No.15/2007, dated 11.09.2007, confirmed both the demand and penalty. Aggrieved by the same, the assessee has filed an appeal, before the CESTAT, Chennai in Appeal No.E/800/2007-DB. The main question, which came up for consideration, before the Tribunal, was whether, on the basis of the facts pleaded, the assessee is entitled to the benefit of SSI exemption, under Notification No.8/2003-CE, dated 01.03.2003, excluding certain clearance/turnover from the aggregate clearance computed, as per the Notification, on the following grounds, (i) The assessee has made clearance of the packing materials to the units which have exported the ultimate goods using the packing materials manufactured by it and such clearance of packing materials was claimed to be deemed Export and deductible from computation of total clearance. (ii) The assessee had manufactured packing materials as well as printed leaflet containing the name of the user thereof. Such printed materials were branded goods. (iii) The assessee being a man ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssues, as stated above can be settled at the grass root level. 9. On the other hand, the Commissioner of Central Excise, Chennai, has contended that the assessee, being aware of its liability, the extended period of limitation is invokable and secondly, the assessee is not entitled to the benefit of deemed export, in respect of the packing materials manufactured and such materials, whether used by the exporting concerns, is not on record. It was further contended that entire turnover, extracted in page 2 of Order-in-Original shall be considered to deny SSI exemption limit. After hearing the parties, vide Final Order No.40079 of 2016, dated 18.01.2016, the Tribunal, observed and held as follows:- 5. It appears from the impugned order that there is mis-carriage of justice in the entire adjudication process for no consideration of Appellants specific pleading that Tribunals decision in Vadapalani Press (supra) was considerable. It is a fact that decision of the Tribunal in this case was rendered eight months before the adjudication order was passed. Learned adjudicating authority should have considered that decision when a pleading was made by appellant in that behalf before h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 11 AC of CEA, 1944, whereas, the duty is confirmed under Section 11 A (2) of CEA, 1944, invoking extended period, for suppression of facts with an intent to evade payment of duty. 11. In support of the above substantial questions of law, the appellant has raised following grounds, (i) The CESTAT remanded the case back to the adjudicating authority, to redo the adjudication afresh, with a direction to refrain from imposing penalty by observing that since there is only dispute with regard to determination of duty. The CESTAT made the above observation without considering merits other aspects of the case viz. suppression of facts by the assessee with an intention to evade payment of duty and contravention of provisions under Central Excise Rules and notifications issued there under. The CESTAT also failed to take cognizance of discussions made by the adjudicating authority, in this regard, in the impugned order. Hence, the observation of CESTAT that there is only dispute with regard to determination of duty is totally incorrect and; and on this notion, CESTAT ordering of the adjudicating authority to refrain from imposing any penalty, is not tenable in law. (ii) In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lready imposed or refrain from imposing penalty under the said Section. Reliance is placed on the case of M/s.Rajasthan Spinning Weaving Mills reported in 2009 (238) ELT 3 (SC), the Apex court held that Penalty under Section 11AC of Central Excise Act, 1944 is punishment for an act of deliberate deception by the assessee with the intent to evade duty by adopting any of the means mentioned in the section. Both proviso to sub-section (1) of Section 11A of Central Excise Act, 1944 and Section 11AC ibid use same expressions like fraud, collusion, wilful mis-statement, suppression of facts, or contravention of provisions with intent to evade payment of duty. If the notice under Section 11A(1) states that the escaped duty was the result of any conscious and deliberate wrong doing and in the order passed under Section 11A(2) there is a legally tenable finding to that effect then the provision of Section 11AC would also get attracted . The Board had also issued a circular on this issue vide Circular No. 88910912009-CX dated 21.05.2009 clearly stating that there is no discretion to reduce the mandatory penalty equal to duty provided under Section 11AC of the Act. (v) In the instant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng Form-H clearances from the total value of clearances. The duty liability may extend upto Rs..79,65,089/- on re-adjudication. The assessees have not disclosed these facts to the Department. But for verification by the Preventive officers, the fact of such evasion of duty would not have come to the knowledge of the department. Without considering such facts, the CESTAT giving clean chit to the assessee and directing the adjudicating authority to abstain from imposing penalty is not tenable in law. (viii) The tribunal order is not correct in law in directing to abstain rom imposing penalty under Section 11 AC of CEA,1944, whereas, the Board Circular No. 889/09/2009-CX dated 21.05.2009 clearly states that there is no discretion to reduce the mandatory penalty equal to duty provided under Section 11AC of the Act. 12. On the above grounds, Mr.A.P.Srinivas, learned counsel for the appellant made submissions and prayed to pass suitable orders. 13. Per contra, Mr.S.Murugappan, learned counsel appearing for the respondent submitted that the issue relates to interpretation and admissibility of the notification to the case on hand, and in such circumstances, levy of penalty wo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppropriate interest. The Commissioner has imposed a penalty of ₹ 79,65,089/-.Claim of Cenvat Credit has been declined. Ultimately, the Original Authority, on 11.09.2007, ordered as follows: (1) I hold that M/s.CMP are not eligible for the benefit of exemption, on the basis of value of clearances, in a financial year, in terms of Notification No.08/2003-CE, dated 01.03.2003, as amended. I confirmed and demand the amount of ₹ 79,65,089/- (Rupees seventy-nine lakhs, sixty-five thousand and eight-nine only) from M/s.Chennai Micro Print Pvt. Ltd., towards duty payable on the packing cartons and boxes manufactured and cleared by them, during the period from 2003-04 to 2006-07 (upto 12/2006), under Section 11A(2) of the Central Excise Act, 1944. (2) I impose a penalty of ₹ 79,65,089/- (Rupees seventy-nine lakhs, sixty-five thousand and eight-nine only) on M/s.Chennai Micro Print Pvt. Ltd., under Section 11AC of the Central Excise Act, 1944. (3) I demand appropriate interest, under Section 11AB of the Central Excise Act, 1944. (4) I impose a penalty of ₹ 15,00,000/- (Rupees Fifteen Lakhs Only) under Rule 25 of the Central Excise Rules, 2002. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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