2020 (2) TMI 689 - HC - Central Excise

Extended period of limitation - imposition of penalty - benefit of an exemption N/N. 47 of 2002 dated 6 September 2002 as amended and N/N. 6 of 2006 dated 1 March 2006 - It was the case of the Appellant that the Respondent had availed of the benefit in respect of pipe fittings when the benefit of exemption was available only for pipes and not for pipe fittings - HELD THAT - The Tribunal has found that throughout it s returns the Respondent has clearly mentioned the benefit was availed on the pipe fittings and also in the invoices which were on record. We have not been shown any embargo on the Appellant to examine these returns and invoices before the audit took place. We had granted time to the Counsel for the Appellant to demonstrate this position. If in these facts the Tribunal took a view that this is not a case of suppression of facts, the view taken cannot be stated to be perverse. Merely because another view is possible, is not a ground to interfere. The question of law as framed, in the present case does not give rise to any substantial question of law to entertain this Appeal - Appeal dismissed.

Summary

Issues:
1. Whether demand can be sustained for the extended period of limitation?
2. Whether penalty imposition is justified when there is no suppression of fact?

Analysis:

Issue 1:
The appellant contended that the demand should be within the extended period of limitation under Section 11A of the Central Excise Act, 1944 due to suppression of facts by the respondent. However, the Tribunal found that the respondent had consistently disclosed availing the benefit on pipe fittings in their returns and invoices. The Tribunal concluded that there was no suppression of facts, leading to the demand being beyond the normal limitation period. The court upheld the Tribunal's decision, stating that the question of law raised did not present a substantial issue for appeal, as the Tribunal's view was reasonable and not perverse.

Issue 2:
Regarding the imposition of penalty, the Tribunal ruled against the appellant, emphasizing that there was no suppression of facts by the respondent. The appellant argued that even though the respondent was not entitled to the exemption on pipe fittings, availing it amounted to suppression of facts. However, the court noted that the respondent had clearly indicated the benefit availed on pipe fittings in their records, and the Tribunal's decision was not unreasonable. Consequently, the court dismissed the appeal, affirming the Tribunal's ruling on the penalty imposition issue.