2001 (2) TMI 185 - AT - Central Excise

Summary

Issues: Duty liability, penalty imposition, interest payment

Duty Liability:
The case involved assessees engaged in manufacturing Marble Slabs and Tiles, where a physical stock verification revealed a shortage of goods without proof of duty payment. A show cause notice was issued proposing duty recovery and penalty imposition. The Adjudicating Authority confirmed duty demand and imposed penalties on the assessees. The Tribunal set aside the Commissioner's order, remanding the case for further proceedings.

Penalty Imposition:
The Commissioner, in the impugned order, confirmed the duty demand, imposed penalties, and interest under Section 11-AB of the Central Excise Act. The assessees did not contest the duty liability but sought a reduction in penalties. The Tribunal, considering the submissions, reduced the penalty on appellant No. 1, citing that penalty under Section 11-AC need not be equal to the duty amount, as established in previous judgments.

Interest Payment:
The assessees argued that interest under Section 11-AB should apply only from the date of its introduction in the statute. However, the Tribunal upheld the liability to pay interest on the duty demand, as there was no evidence regarding the clearances of goods post the introduction of Section 11-AB. The penalties imposed on Appellant Nos. 2 and 3 were maintained since the duty liability was not disputed.

In conclusion, the appeals were partly allowed, reducing the penalty on appellant No. 1 but upholding the interest payment under Section 11-AB. The Tribunal emphasized that penalties need not be equal to the duty amount, as per legal precedents.