2004 (8) TMI 595 - AT - Central Excise

Summary

Issues:
1. Discrepancy in claimed deductions under Octroi Heada.
2. Imposition of penalty and interest.
3. Determination of duty on account of Octroi.

Analysis:

1. The case involved a dispute regarding the claimed deductions under Octroi Heada by a company for the year 1996-97. The company had claimed deductions amounting to Rs. 4,15,628.00, whereas they had actually paid Octroi Tax of Rs. 2,42,103.52 only. The adjudicating authority relied on a certificate from a Chartered Accountant certifying expenses on Octroi borne by the company to be Rs. 5,38,095.78. The appellant argued that the authority overlooked the charges in the Show Cause Notice and that penalties equivalent to the duty demand had not been imposed, and interest not recovered. The respondent contended that interest was not leviable under Section 11AB of the Central Excise Act, as the duty demand was paid before its determination. The Commissioner found the demand for 1996-97 unsustainable due to higher actual expenses incurred by the assessee, but for 1997-98, duty on the differential amount was deemed payable based on the expenses certified by the Chartered Accountant.

2. Regarding the imposition of penalty and interest, the Commissioner correctly applied Section 11AB, which states that if duty is voluntarily paid in full without reserving any right to appeal within 45 days of the order, no interest shall be payable. As the duty demand was paid before its determination, interest was not leviable. The Commissioner imposed a penalty of Rs. 10,000.00, which was found justified. The Tribunal upheld the Commissioner's decision, stating that the duty was paid before its determination, and there was no basis for interference. The appeal was dismissed due to lack of merit.

3. The Commissioner's decision on the determination of duty on account of Octroi was upheld by the Tribunal. The Commissioner found the duty payable on the differential amount for the year 1997-98 based on the expenses incurred by the assessee. The Tribunal agreed with the Commissioner's calculation method and found the duty payable by the assessee. The Tribunal concluded that the Commissioner's order was correct, and no interference was required. The appeal was dismissed based on the findings regarding the determination of duty on account of Octroi.