2007 (2) TMI 511 - AT - Central Excise

Summary

Issues:
Imposition of penalty under Rule 96ZO for late payment of duty under the Compounded Levy Scheme.

Analysis:
The appellant filed an appeal against a penalty of Rs.4,58,334 imposed for a 15-day delay in depositing duty under the Compounded Levy Scheme. The appellant argued that since the duty was paid with interest, the penalty was unjustified. The Tribunal noted a previous case where the High Court held that penalty consideration should include the delay period, duty amount, and reasons for delay. Despite the duty being paid late, the Tribunal found the appellants liable for a reduced penalty of Rs.1 lakh, in line with the High Court's decision. The impugned order was upheld, and the appeal was disposed of accordingly.

This judgment highlights the importance of timely duty payment under the Compounded Levy Scheme and the consequences of delays. The Tribunal's decision to reduce the penalty while upholding the imposition emphasizes the need for compliance with excise rules and regulations. The reference to the previous High Court case sets a precedent for penalty considerations in similar situations, emphasizing the legal principles guiding penalty imposition under Rule 96ZO of the Central Excise Rules.

The Tribunal's analysis considered the specific circumstances of the case, such as the 15-day delay in duty payment and the subsequent payment with interest. By aligning its decision with the High Court's interpretation of penalty imposition criteria, the Tribunal ensured consistency in legal application. The reduction of the penalty amount to Rs.1 lakh reflects a balanced approach, taking into account both the appellant's arguments and the legal requirements under the Compounded Levy Scheme. Overall, the judgment serves as a reminder of the importance of adherence to excise rules and the potential penalties for non-compliance, even in cases where duty is paid albeit late.