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2011 (6) TMI 119 - AT - Central ExciseLimitation - Find that the appellant have not challenged the findings on facts arrived at by the lower authorities that the goods were actually cleared in the month of March 2002 and the bills were raised in February 2002, so as to evade payment of duty, which was introduced with effect from 01.3.2002 - As such, the activities of the appellants were clandestine in nature, in which case the time-bar will not apply, as held by the Hon ble Gujarat High Court in the case of Commissioner of Central Excise Surat vs. M/s. Neminath Fabrics Pvt. Limited 2010 -TMI - 201472 - GUJARAT HIGH COURT As regards the appellant s claim of cum-duty price, we note that it is well settled law that benefit of cum-duty is required to be extended even in the cases of clandestine removal - The reference in this regard can be made to the Larger Bench decision in the case of Srichakra Tyres Limited vs. CCE, Madra (1999 -TMI - 48754 - CEGAT, NEW DELHI)- As such, are of the view that the demand is required to be re-calculated by extending the benefit of cum-duty price. Penalty - As per the Hon ble Supreme Court in the case of Dharmendra Textile Processors (2008 -TMI - 31520 - SUPREME COURT), the appellants are liable to penalty under said Section 11AC equivalent to the duty confirmed against them.
Issues:
1. Duty evasion through backdated invoices 2. Calculation of duty amount 3. Imposition of penalty under Section 11AC 4. Claim of cum-duty price 5. Time-bar applicability Analysis: 1. The case involved the appellants, engaged in manufacturing Submersible Pumps, who were found to have issued backdated invoices to evade duty payment after the duty was levied on their goods. The Central Excise Officers conducted checks and found discrepancies in the sale invoices, leading to investigations and proceedings against the appellants. 2. The proceedings initiated by the Revenue resulted in a demand for duty amounting to Rs. 2,19,231, along with interest and penalty under Section 11AC. The original adjudicating authority confirmed the demand and imposed a penalty, which was challenged by the appellants in the appeal. 3. The main grievance of the appellants was the calculation of duty without granting them the cum-duty price and the imposition of a 100% penalty under Section 11AC. They argued that 80% of the demand was deposited prior to the show cause notice, and the demand was also claimed to be barred by limitation. 4. The Tribunal noted that the appellants did not dispute the findings that the goods were actually cleared in March 2002 but invoiced in February 2002 to avoid duty payment. The Tribunal referred to the law regarding clandestine removal and cum-duty price benefits, directing a recalculation of the duty amount to include the cum-duty price benefit. 5. Regarding the penalty under Section 11AC, the Tribunal relied on a Supreme Court judgment to uphold the penalty equivalent to the confirmed duty amount. The matter was remanded to the original adjudicating authority to quantify the duty and penalty, with an option for the appellants to reduce the penalty to 25% by paying the dues within a specified period. In conclusion, the Tribunal remanded the matter to the original adjudicating authority for recalculation of the duty amount with the cum-duty price benefit and quantification of the penalty under Section 11AC, providing the appellants with an option to reduce the penalty by timely payment.
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