2003 (10) TMI 141 - AT - Central Excise

Summary

Issues involved: Imposition of penalty and demand for interest on M/s. Hindustan Copper Ltd.

Analysis:

1. Imposition of Penalty:
The appeal filed by M/s. Hindustan Copper Ltd. raised the issue of whether a penalty is imposable on them. The Commissioner had confirmed the duty demand and imposed a penalty of Rs. 65,87,143. The company did not challenge the duty demand but argued that they were unaware of the duty imposition due to their unit's remote location in Madhya Pradesh. They started paying the duty immediately upon being informed about the withdrawal of exemption. The Tribunal noted that there was no evidence of wilful suppression or intention to evade duty. The duty was paid before confirmation by officers, indicating a bona fide non-payment due to lack of awareness. Consequently, the Tribunal held that no penalty was required to be imposed in this case.

2. Demand for Interest:
The issue of demand for interest under Section 11AB and Section 11AA of the Central Excises Act, 1944 was also raised. The company argued that as they paid the duty promptly upon being informed about the withdrawal of exemption, there was no intention to evade payment. The Tribunal agreed that there was no intention to evade duty, and therefore, interest under Section 11AA was deemed not imposable. Additionally, since there was no wilful suppression or evasion, the Tribunal concluded that interest under Section 11AB was also not applicable. As a result, the Tribunal set aside the demand for interest.

In conclusion, the Tribunal ruled in favor of M/s. Hindustan Copper Ltd., holding that no penalty or interest was imposable on them due to the lack of wilful suppression or intention to evade duty, as they promptly paid the duty upon being informed about the withdrawal of exemption.