2014 (7) TMI 1022 - AT - Central Excise

Failure to produce certificates as required under exemption Notification No. 6/2006-CE from the Project Implementing Authority - Held that - the adjudicating authority has correctly confirmed the demands along with interest - since the appellant had always been informing the lower authorities about the intention of claiming benefit of Notification No. 6/2006, we are of the view that penalty which has been imposed on the appellant seems to be excessive. - penalty reduced to ₹ 1,00,000 lakh only.

Summary

Issues:
1. Benefit of Notification No. 6/2006-CE for duty exemption.
2. Failure to produce required certificates for duty exemption.
3. Imposition of penalties on the appellant.

Analysis:
1. The appellant sought clearance of goods without duty payment under Notification No. 6/2006-CE. Lower authorities initially granted this benefit. However, a show cause notice was later issued for the appellant to provide a certificate of discharge of duty liability for clearances made during a specific period. Adjudicating authority confirmed the demand, interest, and penalties. The appellant claimed they were in the process of obtaining the required certificates but had not received them yet. They paid the duty and penalty upon filing the appeal. The Tribunal noted the appellant's failure to produce the certificates both before the adjudicating authority and the Tribunal, leading to the confirmation of the demand and interest by the adjudicating authority.

2. The Tribunal found that the appellant had cleared goods during a certain period by undertaking to produce the necessary certificates under Notification No. 6/2006-CE. Despite multiple opportunities, the appellant could not present these certificates, crucial for claiming the exemption. As a result, the Tribunal agreed with the adjudicating authority's decision to confirm the demands and interest due to the absence of the required certificates from the Project Implementing Authority. The Tribunal upheld the order based on the appellant's failure to produce the essential certificates.

3. Regarding the penalties imposed on the appellant, the Tribunal considered the circumstances of the case. While acknowledging the appellant's consistent communication with the authorities regarding the intention to claim the benefit of the notification, the Tribunal deemed the penalty excessive. In the interest of justice, the Tribunal reduced the penalty imposed on the appellant to Rs. 1,00,000. The impugned order was upheld, and the appeal was disposed of with the adjusted penalty amount.

This judgment highlights the importance of complying with documentary requirements for claiming duty exemptions under specific notifications, emphasizing the need for timely and accurate submission of necessary certificates to support such claims.