2009 (5) TMI 761 - AT - Central Excise

Remand order - Scope of - Adjudication order - Penalty - Imposition of - Held that - neither the penalty nor the demand of interest on duty is liable to be contested on the ground that there was no determination of duty in this case - there can be no valid challenge against the penalty on the ground that the Cenvat credit in question was reversed prior to issue of the show-cause notice - appeal dismissed - decided against appellant.

Summary

The Appellate Tribunal CESTAT, Mumbai ruled on a case where certain inputs on which Modvat credit had been taken were removed to a sister concern without following the prescribed procedure. The Deputy Commissioner of Central Excise confirmed a demand of Rs. 1,53,394 under Section 11A of the Central Excise Act, imposed a penalty of the same amount under Section 11AC, and ordered interest under Section 11AB. An appeal by the assessee was rejected by the Commissioner (Appeals) and remanded by the Tribunal. The Tribunal directed the Commissioner to reconsider all issues. The Commissioner upheld the original order, and the assessee appealed this decision. The Tribunal heard both sides and noted that the case was remanded to consider if the original demand was beyond the show-cause notice. The Tribunal found that the demand was valid as the show-cause notice clearly alleged duty contraventions and intent to evade payment. The Tribunal upheld the penalty and interest charges, citing the Supreme Court's ruling that penalty under Section 11AC cannot be waived if duty is paid before the show-cause notice. The Tribunal dismissed the appeal on 29-5-2009.