TMI Blog2023 (4) TMI 1069X X X X Extracts X X X X X X X X Extracts X X X X ..... the present case, merely pleading ignorance of law, the assessee cannot wriggle out of the duty liability for the larger period. The Tribunal has been kind enough to remand the matter for de novo adjudication on a claim of Modvat credit and that has been allowed. However, the fact remains that duty liability has to be worked out for the larger period if the ingredients of Section 11A has been made out. In view of the above decisions of Hon ble Bombay High Court and of Hon ble Madras High Court, we do not find any merits in this appeal. Appeal dismissed. - Excise Appeal No. 85442 of 2013 - FINAL ORDER NO. A/85545/2023 - Dated:- 11-4-2023 - MR. SANJIV SRIVASTAVA, MEMBER (TECHNICAL) AND DR. SUVENDU KUMAR PATI, MEMBER (JUDICIAL) Shri Vinay S. Sejpal, Advocate, for the Appellant Shri Sunil Kumar Katiyar, Assistant Commissioner, Authorised Representative for the Respondent ORDER This appeal is directed against Order-in-Appeal No. BR (87)MV/2012 dated 03.12.2012 passed by the Commissioner of Central Excise (Appeals), Mumbai-V. By the impugned order, Commissioner (Appeals) has rejected the appeal filed by the appellant against Order-in-Original No. 282/05 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 30%. However, appellant continued to clear the goods on payment of duty determined after claiming abatement of 35% from the MRP declared. 2.3 During the course of audit, the above discrepancy was noted and the appellant was directed to pay the differential duty for the period from April 2010 to the date of audit in April 2011. Accordingly the appellant had paid a sum of Rs. 7,000/- vide Entry No. 16 dtd 30/04/2011 from RG-23A Pt. II and interest of Rs. 80/- vide E-Payment dated 02/05/2011 for the clearances made for the month of April, 2011 and they further paid the differential duty on account of said difference in assessable value for the period April, 2010 to March, 2011, amounting to Rs. 3,12,893/- (i.e. BED of Rs. 3,03,779/- + Ed. Cess of Rs. 6,076/- + SHE Cess of Rs. 3,038/-) along with interest of Rs. 42,252/- (so calculated @ 13% up to 31/03/2011 and @ 18% till date of payment) vide E-Payment under GAR-7 Challan No. 00051 dated 07/09/2011. 2.4 A show cause notice dated 11.08.2011 was issued to the appellant asking them to show cause as to why:- (i) Rs.5,93,205/- (Rupees Five lakhs ninety three thousand two hundred and five only) [Rs.5,75,026/- (CENVAT)+ Rs.11,510 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed copies of ERI Returns, but on perusal of the same, it is found that they have not mentioned any details with respect to Notification on which they claiming abetment. The appellant contented that department new of the errors through their monthly Returns-ERI. However it is clearly seen that that appellant had not mentioned any details with respect to abetment Notification. This fact was also highlighted by the adjudicating authority in their order: 06. The appellant has also referred to the copies of letter submitted with respect to Intimation of Materials Returned-Duty paid Goods . It is found that appellant has merely furnished the letter informing the jurisdictional Superintendent in respect of Returned goods and not for any other purpose. The purpose of such intimation is to inform the receipt of duty paid goods back to the manufacturer factory for some re-conditioning/corrective measures etc, and same is recorded in their books of accounts. Hence the appellants remark that department knew of the everything is incorrect. As the purpose of filing the letter was altogether different. The appellant should have been aware of the laws governing their factory ie Factory Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) of the Central Excise Act, 1944. The facts and circumstances of this case show satisfaction of the charge of suppression of the facts, stated in Section 11A(4) thereof, which came to be unearthed only upon the audit scrutiny of the records of the noticee. Thereby, occurs the satisfaction of the ingredients of Section 11A(5) of the Central Excise Act, 1944, which states that Where, during the course of any audit, investigation or verification, it is found that duty has not been levied or paid or short-levied or short-paid or erroneously refunded for the reason mentioned in clause (a) or clause (b) or clause (c) or clause (d) or clause (e) of sub-section (4) but the details relating to the transactions are available in the specified record, then in such cases, the Central Excise Officer shall within a period of five years from the relevant date, serve a notice on the person chargeable with the duty requiring him to show cause why he should not pay the amount specified in the notice along with interest under section 11AA and penalty equivalent to fifty per cent of such duty .This is the true ratio of Madras Petro-chem Limited, 1999 (108) ELT 611. In Dharmendra Textile Processors, 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the letters dated 18-1-1990 and 16-2-1990 clearly reveal that the Petitioners were fully aware of their obligations under the said Rules and the procedure provided for claiming refund in the nature of drawback and yet while filing the application beyond the period of limitation, no cause for delay was disclosed, leave aside the sufficient cause . It was only on 30-3-1990 for the first time after filing the said applications that the Petitioners thought of requesting for condonation of delay in relation to the applications pertaining to the export dated 15th December, 1989 and thereafter on 5-4-1990 in relation to the export dated 16- 12-1989. Further by a letter dated 19-4-1990 in relation to all the six exports and a letter dated 15-5-1990 in respect of all the 7 exports, the cause of delay was sought to be disclosed by the Petitioner s - firstly being that they had to meet the deadline stipulated by the importer and, therefore, they had fully concentrated on manufacture and export of product, secondly that they had no expertise and experience in post-shipment formalities and were new in the field of exports, and thirdly that their costing was based on the presumption that they ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be worked out for the larger period if the ingredients of Section 11A has been made out. 18 . In Collector of Central Excise, Hyderabad v. Chemphar Drugs Liniments, Hyderabad [AIR 1989 SC 832 = 1989 (40) E.L.T. 276 (S.C.)], the Supreme Court passed the following order :- 8. .. In our opinion, the order of the Tribunal must be sustained. In order to make the demand for duty sustainable beyond a period of six months and up to a period of 5 years in view of the proviso to sub-section 11A of the Act, it has to be established that the duty of Excise has not been levied or paid or short-levied or short-paid, or erroneously refunded by reasons of either fraud or collusion or wilful mis-statement or suppression of facts or contravention of any provision of the Act or Rules made thereunder, with intent to evade payment of duty. Something positive other than mere inaction or failure on the part of the manufacturer or producer or conscious or deliberate withholding of information when the manufacturer knew otherwise, is required before it is saddled with any liability, beyond the period of six months. Whether in a particular set of facts and circumstances there was any fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e first question of law against the assessee and in favour of the Revenue. 22 . Insofar as the issue relating to penalty under Section 11AC is concerned, this Court had occasion to deal with similar issue in CMA No. 1099 of 2008, wherein the decisions in Dharmendra Textiles case and Rajasthan Spinning Weaving Mills case (supra) were taken into consideration and this Court, in the said judgment held as under :- 8. While considering the pari materia provision, namely, Section 11AC of the Central Excise Act, the Supreme Court in the decision reported in 2008 (231) E.L.T. 3 (S.C.) (Union of India v. Dharamendra Textile Processors), held as follows : 26. In Union Budget of 1996-97, Section 11AC of the Act was introduced. It has made the position clear that there is no scope for any discretion. In para 136 of the Union Budget reference has been made to the provision stating that the levy of penalty is a mandatory penalty. In the Notes on Clauses also the similar indication has been given. 27. Above being the position, the plea that the Rules 96ZQ and 96ZO have a concept of discretion inbuilt cannot be sustained. Dilip Shroff s case (supra) was not correctly ..... X X X X Extracts X X X X X X X X Extracts X X X X
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