2015 (3) TMI 1093 - AT - Central Excise

Duty demand - Invocation of extended period of limitation - Penalty u/s 11AC - Held that - Commissioner by the impugned order by invoking extended period under proviso to Section 11A (1) has confirmed the duty demand of ₹ 11,27,06,058/- against the respondent alongwith interest on it under Section 11AB and has imposed penalty of ₹ 2,59,15,371/- on the respondent under Section 11AC. The Commissioner had also allowed Cenvat credit of ₹ 8,67,90,687/- and the penalty imposed under Section 11AC was the difference between the duty demand and the Cenvat credit admissible. It is seen that the appeal filed by the respondent against this order of the Commissioner has been allowed by the Tribunal vide judgment mentioned above and the entire order of the Commissioner has been set aside - Decided against Revenue.

Summary

Issues:
1. Duty demand confirmation with interest and penalty imposition.
2. Cenvat credit admissibility.
3. Imposition of penalty on the authorized signatory.

Analysis:

Issue 1: Duty Demand Confirmation, Interest, and Penalty Imposition
The Commissioner confirmed a duty demand of Rs. 11,27,06,058 against the respondent for the period from March 1999 to April 2002 under the proviso to Section 11A(1) of the Central Excise Act, 1944. Additionally, interest was imposed under Section 11AB, and a penalty of Rs. 2,59,15,371 was levied under Section 11AC. The Commissioner allowed Cenvat credit of Rs. 8,67,90,687 to the respondent. The respondent appealed against this order, and the Tribunal set aside the entire duty demand, interest, and penalty due to time bar, leading to the dismissal of the Revenue's appeal as it did not survive.

Issue 2: Cenvat Credit Admissibility
The Revenue contended that the Cenvat credit admissible to the respondent should be lower. However, the Tribunal's decision to set aside the duty demand also nullified this argument, rendering it moot.

Issue 3: Imposition of Penalty on Authorized Signatory
The Commissioner did not impose any penalty on the authorized signatory of the respondent company, Shri Deepinder Singh, despite a proposal in the show cause notice. The Revenue appealed for the imposition of a penalty on Shri Deepinder Singh under Rule 209A of the Central Excise Rules, 1944. However, the Tribunal's decision to set aside the entire order of the Commissioner meant that this appeal did not survive, leading to the dismissal of the request for imposing a penalty on the authorized signatory.

In conclusion, the Tribunal allowed the respondent's appeal, setting aside the duty demand, interest, and penalty imposed by the Commissioner. Consequently, the Revenue's appeal did not survive as the Tribunal's decision invalidated the grounds on which the appeal was based.