2006 (2) TMI 347 - AT - Central Excise

Summary

Issues:
1. Appeal against vacating a penalty imposed under Section 11AC of the Central Excise Act by the Commissioner (Appeals).
2. Appeal regarding interest under Section 11AB on duty paid prior to issuance of show cause notice.

Analysis:
1. The appeal before the Appellate Tribunal CESTAT, CHENNAI was related to a penalty imposed on the respondents under Section 11AC of the Central Excise Act. The original authority had imposed the penalty, which was vacated by the Commissioner (Appeals). However, the appellate authority imposed a penalty under Rule 173Q while sustaining the duty demand confirmed by the original authority. The Tribunal had previously held in a Final Order that no penalty was imposable on the assessee, citing a previous case involving Rashtriya Ispat Nigam Ltd. The Tribunal's decision was affirmed by the Hon'ble Apex Court. As a result, the question of imposing a penalty under Section 11AC was already settled against the Revenue by the Final Order, leading to the rejection of the appeal.

2. Another relief sought in the appeal was regarding interest under Section 11AB on the duty amount paid by the respondents before the issuance of a show cause notice. The claim for interest was based on the explanation to sub-section (2B) of Section 11A of the Central Excise Act, which stated that interest under Section 11AB shall be payable on the amount paid by the person under sub-section (2B). The appellant argued that the assessee should pay interest on the duty amount already paid due to the extended period involved in the case. However, the Tribunal noted that the provisions of sub-section (2B) of Section 11A and its explanations, which were inserted in the statute from 11-5-2001, were not applicable to the case in question, which pertained to the period between November 1997 to May 1998. The Tribunal accepted the submission that the provisions were not applicable to the case at hand. Consequently, the ground raised by the appellant for levying interest on the duty paid before the show cause notice issuance was not sustained, leading to the rejection of the appeal.

In conclusion, the Tribunal dismissed the appeal concerning the penalty under Section 11AC and the interest under Section 11AB, upholding the decisions made by the lower authorities and providing a detailed analysis of the legal provisions and precedents involved in the case.