2015 (12) TMI 868 - HC - Central Excise

Waiver of pre deposit - Demand of 10% pre deposit of penalty - Held that - Factory premises of M/s. Amba Re-rolling Mill Pvt Ltd has already been closed down since 2009. The balance sheet of the Company reveals that there is a loss of ₹ 4,20,789/- during the assessment year 2011- 12. CESTAT, Kolkata has also pointed out this fact at per paragraph 15 of the order dated 3rd of July, 2012 which is under challenge. Nonetheless, the Tribunal has pointed out that current asset of this company is approximately ₹ 3.00 Crores as on 31st March, 2011, and, therefore, 10% penalty has been ordered to be deposited by this appellant. - As the penalty imposed personally upon this appellant of 10% is absolutely reasonable amount to be deposited by this appellant, counsel for the appellant is ready to deposit ₹ 10.00 lakhs within four weeks on the condition that the appeal preferred by this appellant before the CESTAT, Kolkata is revived and the same will be decided on its own merits. - Decided in favour of assessee.

Summary

Issues:
1) Appeal against penalty imposed by Commissioner of Central Excise and Service Tax
2) Closure of factory premises of M/s. Amba Re-rolling Mill Pvt Ltd
3) Financial status of the company and penalty amount
4) Deposit of penalty amount for revival of appeal before CESTAT, Kolkata

Analysis:
1) The appeal was filed by one of the Directors in M/s. Amba Re-Rolling Mill Pvt. Ltd. against the penalty imposed by the Commissioner of Central Excise and Service Tax, Jamshedpur. The appellant was directed to deposit 10% of the penalty, but as the amount was not deposited, the appeal was dismissed.

2) The factory premises of M/s. Amba Re-rolling Mill Pvt Ltd had been closed down since 2009. The balance sheet of the company showed a loss of &8377;4,20,789 during the assessment year 2011-12. Despite the company having a current asset of approximately &8377;3.00 Crores as of 31st March, 2011, a 10% penalty was ordered to be deposited by the appellant.

3) The penalty amount of 10% imposed on the appellant was deemed reasonable. The counsel for the appellant agreed to deposit &8377;10.00 lakhs within four weeks on the condition that the appeal before CESTAT, Kolkata would be revived and decided on its merits.

4) The appellant was allowed to deposit the penalty amount of &8377;10.00 Lakhs before CESTAT, Kolkata within four weeks. If the deposit was made within the stipulated period, the appeal would be revived and heard on its merits by CESTAT, Kolkata. The appeal was allowed and disposed of accordingly, with the interlocutory application also being disposed of in light of the final order passed in the main appeal.