2016 (8) TMI 1103 - AT - Central Excise

Liability of interest and penalty - Suo moto abatement - regularized by the Commissioner though at later stage but the grant of abatement should be considered deemed to have been granted when the appellant has suo moto taken the abatement - Held that - the appellant had taken the suo moto abatement by paying less duty to that extent towards the closure of the factory from 15.7.1999 to 23.7.1999 but for the same period the Commissioner vide order had allowed abatement. In this peculiar fact I am of the view that the abatement suo moto taken by the appellant was knowingly allowed by the Commissioner. Therefore the suo moto abatement has been regularized by the Commissioner s order. The abatement stand granted from the date of suo moto abatement taken by the appellant. I therefore do not see any reason why the interest is payable, consequently penalty is also not imposable. Therefore, the interest and penalty is set aside. - Decided partly in favour of assessee

Summary

Issues involved:
1. Inclusion of galleries in measurements of stenters.
2. Suo moto abatement taken by the appellant.

Analysis:
1. Inclusion of galleries in measurements of stenters:
The case involved a dispute regarding whether galleries should be included in the measurements of stenters. The Revenue contended for their inclusion, but both the Commissioner (Appeals) and CESTAT upheld the order in favor of the appellant, ruling against the Revenue's argument. This issue was resolved in favor of the appellant.

2. Suo moto abatement taken by the appellant:
The second issue revolved around the suo moto abatement taken by the appellant. The Commissioner (Appeals) did not provide any findings on this matter, leading the CESTAT to hold that the Order-in-Appeal was not sustainable specifically concerning the issue of suo moto abatement. The case was remanded for further consideration on this point. In the subsequent decision, the Commissioner imposed interest and penalty on the appellant. The appellant argued that the abatement should be considered deemed to have been granted when they took it suo moto, citing legal precedents to support their stance. On the contrary, the respondent argued that the abatement was only valid from the date the Commissioner allowed it, and relied on various judgments to support their position. Ultimately, the tribunal ruled in favor of the appellant, stating that the abatement taken by the appellant was knowingly allowed by the Commissioner and therefore deemed regularized. Consequently, the interest and penalty were set aside, but the duty amount paid short by the appellant was deemed correctly payable, along with the associated interest and penalty.

In conclusion, the tribunal partially allowed the appeal, modifying the impugned order to reflect the findings on the issues discussed. The judgment was pronounced on 26/07/2016 by Shri Ramesh Nair, Member (Judicial) at the Appellate Tribunal CESTAT Mumbai.