TMI Blog2022 (9) TMI 1338X X X X Extracts X X X X X X X X Extracts X X X X ..... een amended and the amended rule 17(2) cannot impose duty at a higher rate with retrospective effect. In the present case, if the contention of learned authorised representative appearing for the department is accepted, the respondent would be subjected to higher rate of duty then what was prevailing at that time the search was conducted. Penalty on Sumit Agarwal - HELD THAT:- No submission was made by learned authorised representative regarding that part of the order by which the Principal Commissioner refrained from imposing penalty on Sumit Agarwal as penalty had already been imposed upon M/s. OM Fragrances. Appeal of Revenue dismissed. - Excise Appeal No’s. 51718-19 of 2018 - FINAL ORDER Nos. 50933-50934/2022 - Dated:- 29-9-2022 - MR. DILIP GUPTA, PRESIDENT AND MR. P.V. SUBBA RAO, MEMBER (TECHNICAL) Shri Rakesh Agarwal, Authorized Representative for the Department None for the Respondent ORDER The order dated 30.11.2017 passed by the Principal Commissioner, CGST, Delhi-2 [ the Principal Commissioner ], pursuant to the order dated 03.02.2017 passed by the Tribunal, has been assailed by the department in which M/s. OM Fragrances [the respondent] ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ix Lacs Forty Seven Thousand Three Hundred and Sixty One only) should not demanded recovered under section 11A of the Central Excise Act, 1944 from the party for the clandestine manufacture and clearances of excisable goods namely India Gold Gutkha for the period December, 2007 to 04.08.08 which includes the duty involved on seized goods. c. Rs. 75,00,000/- (Rs. Seventy Five Lacs Only) deposited towards the Excise dues by Sh. Sumit Agarwal, Partner of the party should not be appropriated and adjusted towards the duty payable by the party. d. Penalty should not be imposed upon M/s. OM Fragrances, H. No. 786, opposite Kalandeshwar Shiv Temple, Village Burari, Delhi under Rule 25 of the Central Excise Rules, 2002 read with Section 11AC of the Central Excise Act, 1944. e. Interest at an appropriate rate should not be charged from the Party under Section 11AB of the Central Excise Act, 1944. 4. Shri Sumit Agarwal, and Shri Rajeev Gupta were also called upon to show cause as to why penalty should not be imposed upon them under Rule 26 of the Central Excise Rules, 2002 for their acts of omission and commission. 5. The period involved in the show cause notice is from De ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e show cause notice is by application of rule 17(2) of Pan Masala Packing Machines (Capacity Determination and Collection of Duty) [the 2008 Rules], which came into effect from 01.07.2008 for the period from 01.07.2008 to 04.08.2008. 10. Rule 17(2) of the 2008 Rules is reproduced below: 17 . Penalty for contraventions, etc. (1) Subject to the provisions of section 11AC of the Act, if any manufacturer produces or removes notified goods in contravention of any provision of these rules, then alls such goods shall be liable to confiscation, and the manufacturer shall be liable to a penalty not exceeding the duty leviable on the notified goods ain respect of which aforesaid contravention has been committed. (2) I it is found that goods have been cleared from a unit which is not registered with the jurisdictional Central Excise Office, then its duty liability for the period till it was not registered, shall be determined as if the goods manufactured by the unit were not eligible for levy and assessment under notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 29/2008-C.E. (N.T.), dated the 1st July, 2008 and dealt with accordingl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0/-. It is also undisputed that duty per month was Rs. 4,23,696/- and Rs. 2,28,144/- when it was manufacturing Rs. 1 MRP pouch and Rs. 0.50 MRP pouch respectively. From this and above discussions, duty is recalculated as below:- Period Amount (in Rs.) Dec., 2007 to June 2008 (as per SCN) 23,79,216 July, 2008 (Rs. 0.50 MRP Pouch) 2,28,144 August, 2008 (for 3 days August being 31 days month i.e. 228144*3/31) 22,079 Total 26,29,439 16. Learned authorised representative appearing for the department emphasised that though the amended rule 17(2) may have come into force from 20.10.2008, but since it has been stated in the amended rule 17(2) that such machines shall be deemed to have been in operation since 01.07.2008, the rule should be applied respectively w.e.f. 01.07.2008. 17. It is not possible to accept this contention of the learned authorised representative appearing for the department. 18. It is not in dispute that the search was cond ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eld to be eligible to obtain the benefits of an exemption notification, the same should be liberally construed. 21. This decision followed by the Karnataka High Court in Fosroc Chemicals (India) and Madras High Court in Mehler Engineered Products. 22. These decisions would not help the appellant as they deal with amendment by substitution. In any case, the Supreme Court also made it clear that in such a situation the amendment would be retrospective since no substantive right had been taken away nor any penal consequences had been imposed and only an obvious mistake was sought to be removed. In the present case, if the contention of learned authorised representative appearing for the department is accepted, the respondent would be subjected to higher rate of duty then what was prevailing at that time the search was conducted. 23. No submission was made by learned authorised representative regarding that part of the order by which the Principal Commissioner refrained from imposing penalty on Sumit Agarwal as penalty had already been imposed upon M/s. OM Fragrances. 24. There is, therefore, no merit in the two appeals filed by the Department and they are dismissed. (Or ..... X X X X Extracts X X X X X X X X Extracts X X X X
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