2004 (5) TMI 425 - AT - Central Excise

Summary

Issues: Duty demand confirmation, Abatement claim rejection, Penalty imposition

Duty Demand Confirmation:
The appeal challenged the impugned order confirming a duty demand of Rs. 7,11,469 along with an equal penalty. The duty was confirmed due to the disallowance of abatement claim for specific periods related to the closure of the factory engaged in manufacturing non-alloy steel ingots/billets chargeable to duty. The appellants claimed abatement, which was rejected by the Commissioner, leading to the duty confirmation against them. The Tribunal upheld the duty confirmation as the abatement claim rejection had attained finality.

Abatement Claim Rejection:
The appellants' abatement claim for the mentioned periods was based on their furnace closure, resulting in a duty abatement amounting to Rs. 12,56,159. However, the Commissioner rejected this claim, which was further dismissed by the Tribunal for non-compliance with its stay order. The rejection of the abatement claim led to the affirmation of duty against the appellants for the claimed period, as they failed to pay the duty despite alleging furnace closure.

Penalty Imposition:
While the duty confirmation was upheld, the penalty imposed equal to the duty amount was considered harsh by the Counsel. It was argued that the appellants had no fraudulent intention and were actively pursuing their abatement claim. Considering the circumstances, the penalty was reduced to Rs. 50,000. Apart from this penalty modification, the impugned order was upheld, and the appeal was disposed of accordingly.