2009 (10) TMI 723 - AT - Central Excise

Summary

Issues involved: Delay in payment of duty, confirmation of demand for interest, imposition of penalty, non-compliance with stay order, communication of order to the appellants.

Delay in payment of duty: The appellants, engaged in processing man-made fabrics, faced proceedings for delayed payment of duty under the compounded levy scheme. An interest amount of Rs. 6,050/- was confirmed, along with a penalty of Rs. 6,20,000/- under the relevant rules.

Non-compliance with stay order: The appellants failed to comply with the direction to deposit Rs. 2,00,000/- by a specified date, leading to the rejection of the appeal for non-compliance with the stay order. However, a writ petition before the Hon'ble Gujarat High Court resulted in directions for the appeal to be heard without requiring any pre-deposit.

Communication of order: The appellants claimed they received no communication from the department regarding the final order until a letter for recovery of dues was received in 2009. The department failed to prove the delivery of the order, and the appellants argued that dispatch by registered post does not constitute valid communication u/s 37C of the Central Excise Act, citing a Tribunal decision.

Decision: The Tribunal found that the department could not prove the appellants received the order, considering the appeal as filed within time. The impugned order was set aside due to the directions of the Hon'ble High Court, remanding the matter to the Commissioner (Appeals) for further proceedings in accordance with the High Court's directives.