2013 (7) TMI 828 - AT - Central Excise

Initiation of penal provisions after expiry of 5 years - Commissioner held that penal proceedings under Rule 96ZP(3) cannot be initiated after expiry of five years - Held that - Following decision of CCE, Chandigarh Vs. Hari Concast (P) Ltd. 2009 (4) TMI 170 - PUNJAB AND HARYANA HIGH COURT and M/S Bhawani Castings (P) Ltd. Mandi Gobindgarh Versus Commissioner Central Excice, Chd. 2010 (4) TMI 284 - PUNJAB & HARYANA HIGH COURT - Decided against Revenue.

Summary

Issues:
Whether penal provisions of Rule 96ZP(3) for failure to discharge monthly duty liability by the due date can be initiated after the expiry of 5 years.

Analysis:
The case involved the respondent engaged in manufacturing hot rolled products of non-alloy steel subject to central excise duty under Rule 96ZP of the erstwhile Central Excise Rules, 1944. The central issue was the initiation of penal provisions under Rule 96ZP(3) after the lapse of 5 years. The Commissioner (Appeals) had ruled that penal proceedings cannot be initiated after this period, leading to the Revenue's appeal.

During the proceedings, the Departmental Representative contested the Commissioner's order based on the grounds of appeal in the Revenue's case. On the other hand, the respondent's Counsel referred to a judgment by the Hon'ble Punjab & Haryana High Court in the case of CCE, Chandigarh Vs. Hari Concast (P) Ltd., arguing that penal proceedings under Rule 96ZP(3) could not be initiated after 5 years. The Counsel highlighted that the Revenue's appeal relied on a Tribunal judgment reversed by the Punjab & Haryana High Court.

After hearing both sides and examining the records, the judge, relying on the judgments of the Hon'ble Punjab & Haryana High Court in the cases mentioned, ruled in favor of the respondent. The judge found no merit in the Revenue's appeal and subsequently dismissed it, upholding the decision that penal proceedings under Rule 96ZP(3) cannot be initiated after the expiration of 5 years.