2007 (3) TMI 464 - AT - Central Excise

Summary

Issues Involved: Appeal against reduction of penalties imposed by adjudicating authority under Rule 25 of Central Excise Rules, 2002 for non-payment of duty by due dates and interest, and imposition of penalty under Rule 27 for contravention of Rule 8(3).

Summary:
1. The Revenue filed three appeals against the Commissioner (Appeals) order reducing penalties imposed on the respondents to Rs. 5,000 each from penalties equal to the amount of delayed duty payment.

2. The adjudicating authority imposed penalties under Rule 25 of Central Excise Rules, 2002 for contravention of Rules 4 and 8(3) by not paying duty on time and interest. The Commissioner found no intention to evade duty, thus no penalty under Rule 25 but imposed Rs. 5,000 penalty under Rule 27 for contravention of Rule 8(3).

3. The appellant Commissioner concluded that no malafide intention of duty evasion existed as the clearances were reflected in monthly returns. Rule 25 allows penalties not exceeding duty or Rs. 10,000, whichever is greater. Since no contravention was alleged at the time of goods removal and no intention to evade duty, Rule 27 was rightly applied, imposing Rs. 5,000 penalty in each case.

4. The appeals were dismissed as the penalties imposed by the Commissioner were justified under Rule 27 for contravention of Rule 8(3) without evidence of duty evasion intention.

5. The respondents were also ordered to pay interest as per Rule 8(3), a part of the order not challenged by the respondents.