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2018 (1) TMI 1256 - AT - Central ExcisePenalty u/r 25 and 27 of CER - the duty could not be deposited within the prescribed period. The same was deposited subsequently with a delay of ranging from one to three months, along with deposit of interest leviable thereon - Held that - The Tribunal in the case of Saurashtra Cement Ltd. 2010 (9) TMI 422 - GUJARAT HIGH COURT discussed various provisions of Rule 25 as also of Rule 27 and has observed that in case of belated payments in terms of Rule 8, penalty under Rule 27 is imposable - the penalties imposed u/r 25 set aside and the penalties of ₹ 5,000/- imposed in each of the appeals, in terms of the provisions of Rule 27 of CER upheld - appeal allowed in part.
Issues:
Imposition of penalty under Rule 25 of Central Excise Rules for delay in depositing duty amount despite subsequent payment with interest. Interpretation of Rule 25 vis-a-vis Rule 27 in cases of belated payments under Rule 8. Analysis: The appellant, engaged in paper manufacturing, faced penalties under Rule 25 for delayed duty deposits despite later payments with interest. The appellant argued that penalties under Rule 25 were unjustified as they disclosed delays in monthly returns and paid duties subsequently. They contended Rule 25 requires willful suppression, invoking Section 11AC. The appellant cited precedents where Rule 27, not Rule 25, applied in similar cases, urging to set aside Rule 25 penalties and uphold Rule 27 penalties. Upon review, the Tribunal found the issue settled by the Saurashtra Cement Ltd. case, confirming Rule 27 penalties for belated payments under Rule 8. This decision was upheld by the Gujarat High Court and followed by various Tribunal Benches. In F.S. Engineers Vs. CCE, it was noted that non-payment within Rule 8's timeframe, disclosed in returns and paid later with interest, attracts only a &8377; 5,000 penalty under Rule 27. Accordingly, the Tribunal set aside Rule 25 penalties and upheld &8377; 5,000 penalties under Rule 27 in each appeal, aligning with the CER provisions. The appeals were thus disposed of based on the established legal interpretation and precedents.
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