2018 (1) TMI 367 - AT - Central Excise

Seizure of of Raw / Dust Coal - seizure on the ground of nonpayment of Clean Energy Cess on the entire quantity of seized coal - Held that - there is no dispute that Central Excise duty along with Education Cess and Clean Energy Cess is leviable on the seized Raw/Dust Coal. It is found that the appellant is receiving the said coal from the supplier from time to time. It is noted that the goods were supplied to the appellant without any Invoice on several occasions. Hence, the innocence pleaded by the Learned Counsel cannot be accepted - redemption fine justified - appeal dismissed - decided against appellant.

Summary

Issues:
- Imposition of fine and penalty on the appellant for nonpayment of Clean Energy Cess on seized coal
- Allegation of collusion with the supplier
- Failure to produce documents supporting payment of Excise duty and Clean Energy Cess
- Appellant's claim of innocence as a purchaser
- Confiscation of seized goods and imposition of redemption fine and penalties

Imposition of Fine and Penalty:
The appellant filed an appeal against the Order-in-Appeal that imposed fines and penalties for nonpayment of Clean Energy Cess on seized coal. The Central Excise Officers found Raw/Dust Coal at a railway station without proper documentation and detained it. The Adjudicating authority confiscated the goods, imposed a redemption fine, and penalties on the producer/supplier and the appellant. The Commissioner (Appeals) rejected the appeal, leading to the current appeal. The appellant argued that as a purchaser, fines and penalties were unjustified, and collusion allegations were baseless. However, the Commissioner found the appellant received coal without invoices and failed to ensure duty payment, leading to the upheld fines and penalties.

Allegation of Collusion:
The appellant denied collusion with the supplier and claimed innocence as a purchaser. The appellant argued that there was no evidence of collusion and that they were unaware of any duty or cess nonpayment by the supplier. However, the Commissioner found that the appellant failed to produce any documents supporting duty and cess payments on the seized coal, indicating negligence in ensuring compliance with tax laws.

Failure to Produce Documents:
The appellant could not provide documents proving payment of Excise duty and Clean Energy Cess on the seized coal. The Commissioner noted that the appellant received goods without proper invoices, indicating a lack of diligence in verifying duty payments. The Commissioner emphasized that ignorance of tax laws does not exempt one from tax obligations, leading to the upheld imposition of fines and penalties.

Appellant's Claim of Innocence:
The appellant, as a purchaser, claimed innocence regarding duty and cess payments by the supplier. However, the Commissioner found that the appellant received coal without proper documentation and failed to fulfill their duty of ensuring tax compliance. The Commissioner highlighted that being a trader of coal, the appellant should have verified duty payments before accepting goods, leading to the rejection of the appellant's innocence plea.

Confiscation and Penalties:
The Commissioner upheld the confiscation of seized coal due to nonpayment of duties and cess. The redemption fine imposed was deemed justified, being 25% of the goods' value. Additionally, penalties were imposed under relevant rules for dealing with non-duty/cess paid goods. The Commissioner found the penalties legally justified, considering the gravity of the case and the appellant's actions. Ultimately, the appeal was rejected, affirming the lower authority's decision on fines, penalties, and confiscation.

This detailed analysis of the judgment highlights the key issues, arguments presented, findings, and the final decision regarding the imposition of fines, penalties, and confiscation in the case.