2017 (10) TMI 1518 - AT - Central Excise

Levy of late fine - Delay in filing return versus non-filing of return - validity of Rule 12(6) of Central Excise Rules 2002 - vires of Section 37(3) of Central Excise Act 1944 - It is contended that even if there is no challenge to Rule 12(6) the lower authorities have wrongly invoked a provision that is pertinent to late filing whereas there is a case of non-filing. HELD THAT - Rule 12(6) stipulates the payment of an amount for late filing which is not penalty but is a fee for regularization and hence reliance on the decision of Tribunal in the case of Anil Products Ltd. v. Commissioner of Central Excise Ahmedabad 2011 (5) TMI 500 - CESTAT AHMEDABAD is misplaced - Turning to the contention that the said rule is not invocable for non-filing of returns it is not in dispute that these returns have not been should have been and would have to be filed at some point of time; that the appellant has not yet filed those returns indicates that gross disregard for the law. Necessarily as and when those returns are filed all of them would stand delayed by more than 200 days from due date; consequently Rs. 20, 000/- will apply. Hence there is no requirement to set aside the demand for this fee in the impugned order - appeal dismissed - decided against appellant.

Summary

Issues:
1. Challenge to the confirmation of dues under Rule 12(6) of Central Excise Rules, 2002.
2. Non-filing and delayed filing of ER-4 and ER-7 returns.
3. Applicability of Rule 12(6) in case of non-filing.

Analysis:

1. The appellant contested the confirmation of dues under Rule 12(6) of Central Excise Rules, 2002, upheld by the Commissioner of Central Excise (Appeals). The appellant argued that the rule is ultra vires of Section 37(3) of the Central Excise Act, 1944. Additionally, it was contended that the lower authorities wrongly applied a provision meant for late filing to a case of non-filing. The Tribunal noted that Section 37(3) of the Central Excise Act allows for an additional penalty of up to Rs. 5,000 for breaches not explicitly penalized. Rule 12(6) mandates a payment for late filing, considered a fee for regularization, not a penalty. The Tribunal found the appellant's reliance on a previous case misplaced and ruled that the rule is applicable even for non-filing scenarios. As the appellant failed to file the required returns, all of which would be delayed by over 200 days upon filing, the Tribunal upheld the demand of Rs. 20,000 without setting it aside.

2. M/s. Buneesha Chem Pvt. Ltd. neglected to file ER-4 returns for multiple years and delayed the filing of ER-7 returns significantly. The Tribunal confirmed the non-filing and delayed filing, emphasizing the gross disregard for the law by the appellant. The Tribunal noted that the returns must be filed eventually, and their delayed filing would incur the prescribed fee. Consequently, the demand of Rs. 20,000 was upheld due to the prolonged delay in filing the returns.

3. In light of the above circumstances and legal analysis, the Tribunal dismissed the appeal and disposed of the cross objection. The operative part of the order was pronounced in court, affirming the confirmation of dues under Rule 12(6) of the Central Excise Rules, 2002.