2015 (10) TMI 1794 - AT - Central Excise

Denial of abatement claim - Closure of factory - Held that - there is no dispute about the appellant s entitlement to the abatement and Revenue s only objection is as regards the procedural violation. We find that an identical issue was the subject matter of the Tribunal s decision in the case of Shree Flavours Pvt. Ltd. Vs. CCE, Delhi-IV reported in 2014 (4) TMI 417 - CESTAT NEW DELHI , wherein by taking note of the earlier decision of the Tribunal in the case of Kaipan Pan Masala Pvt. Ltd. 2013 (1) TMI 356 - CESTAT, NEW DELHI , it was held that non-deposit of the duty and subsequent non-claiming of the abatement in violation of the procedure prescribed under the said Rules would not result in denial of substantive benefit to the appellant and the only consequence would be confirmation of interest. - Impugned order is set aside - Decided in favour of assessee.

Summary

Issues involved:
Procedural violation in claiming abatement under Pan Masala Packing Machines Rules, 2008.

Detailed Analysis:

1. Issue of Procedural Violation:
The appellants, engaged in Gutkha manufacturing, faced proceedings due to the Revenue's contention that they should have first paid duty for the entire month before claiming abatement for a period of machine closure. The dispute centered around procedural compliance rather than entitlement to abatement. Citing a previous Tribunal decision in Shree Flavours Pvt. Ltd. Vs. CCE, Delhi-IV, it was established that failure to follow the prescribed procedure did not negate the substantive benefit of abatement. The consequence of such a violation was the confirmation of interest, as clarified in the case of Kaipan Pan Masala Pvt. Ltd.

2. Resolution and Decision:
The advocate for the appellants clarified that interest for the abatement period had already been deposited. Consequently, the Tribunal, led by Member Archana Wadhwa, set aside the impugned order and allowed the appeal, except for confirming the interest amount. The decision aligned with previous rulings, emphasizing that procedural lapses did not nullify the right to abatement, with only interest confirmation as a consequence. The appeal and stay application were disposed of accordingly.

This judgment highlights the significance of procedural adherence in claiming abatements under specific rules, ensuring that substantive benefits are not denied due to procedural violations. The decision provides clarity on the consequences of non-compliance, emphasizing the importance of following prescribed procedures while addressing any resulting obligations, such as interest payments.