2015 (9) TMI 266 - AT - Central Excise

Penalty u/s 11AC - Interest u/s 11AB - Demand of differential duty - Held that - There is no dispute that the appellant transferred the goods to their own unit at Kosamba and the duty paid by them would be eligible to cenvat credit to the other units. - Therefore there is Revenue neutrality in this case despite the fact that the appellants have not determined the correct value of the each grade of the Barium Carbonate. In the present case, it is evident that the demand of duty by show cause notice dtd 20th Sept. 2007 for the period 13.7.2004 to 30.9.2004 invoking extended period of limitation would not survive. Hence, the demand of interest and imposition of penalty would also not maintainable. - demand of interest and imposition of penalty are not warranted. Accordingly, the same are set aside. - Decided in favour of Assessee.

Summary

Issues:
Demand of interest and imposition of penalty on the appellant.

Analysis:
The appellant filed an appeal against the demand of interest and imposition of penalty. The case involved the appellant clearing goods to their other unit without following the CAS4 procedure, leading to a subsequent revision of assessable value and payment of differential duty. The Central Excise audit pointed out discrepancies, resulting in a show cause notice for duty demand, interest, and penalty. The Adjudicating Authority confirmed the duty demand, interest, and penalty. The Commissioner (Appeal) upheld most of the adjudication order but set aside the penalty under Section 11AC, reducing the penalty amount. The appellant argued that they voluntarily paid the duty and cited relevant court decisions. The Revenue contended that the appellant did not pay the duty voluntarily as detected by the audit party. The Tribunal found that there was no suppression of facts to evade duty and that the appellant's actions were revenue neutral. The Tribunal cited precedents to support its decision. The Revenue did not file a cross-appeal against the Commissioner (Appeal) findings. The Tribunal concluded that the demand of interest and penalty was not maintainable as the demand of duty for the extended period would not survive due to voluntary payment by the appellant. The Tribunal referenced a Gujarat High Court decision regarding recovery of interest on time-barred duty. In light of the discussion, the Tribunal set aside the demand of interest and penalty, disposing of the appeal in favor of the appellant.