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2013 (10) TMI 444 - AT - Central ExciseWaiver of Penalty under Rule 25 of the CE Rules - Following CCE & Cus. Vs. Saurashtra Cement Limited 2010 (9) TMI 422 - GUJARAT HIGH COURT - penalty for delay in payment of duty cannot be imposed under Rule 25 of the Central Excise Rules, 2002 For default of payment of duty under Rule 8 (3A) of Central Excise Rules, 2002 and no penalty can be imposed under Rule 25 - the appellant has made out a prima facie case for the waiver of pre-deposit of amount of penalty till the disposal of appeal stay granted.
Issues:
1. Imposition of penalty under Rule 25 of Central Excise Rules, 2002 for default of payment of duty under Rule 8 (3A). Analysis: The appellant filed a stay petition against the Order-in-Appeal imposing a penalty of Rs. 50,000 under Rule 25 of Central Excise Rules, 2002 for default in duty payment under Rule 8 (3A). The appellant argued, citing the judgment of the High Court of Gujarat in a similar case, that penalty cannot be imposed under Rule 25 for such defaults. The appellant also relied on judgments like Tejpal Paper Mills Limited vs. CCE, Ahmd. and Shree Ashok Kumar Manibhai Patel & Company vs. CCE, Bhopal to support their argument. The Revenue, represented by Shri Manoj Kutty, contended that penalties under Rule 25 are applicable for defaults under Rule 8 (3A), referring to cases like Pee Dee Polymers vs. CCE, Ahmd. and Weldon Cello Plast Limited vs. CCE, Delhi. After hearing both sides and examining the case laws presented, the Tribunal noted that the jurisdictional High Court had previously ruled that penalties for delays in duty payment cannot be imposed under Rule 25. The Tribunal also referenced its own decision in Siyaram Packaging Pvt. Limited vs. CCE Daman, where a similar view was taken. Consequently, the Tribunal found that the appellant had established a prima facie case for waiving the pre-deposit of the penalty amount, granting a stay on the recovery of the penalty until the appeal is disposed of. The order was dictated and pronounced in court by Mr. H.K. Thakur.
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