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2005 (6) TMI 150 - AT - Central Excise
Issues involved: Denial of benefit of Notification 67/95 on molasses used in manufacture of Ethyl Alcohol, applicability of Notification 67/95, bar of limitation, penalty on Managing Director.
Denial of benefit of Notification 67/95 on molasses used in manufacture of Ethyl Alcohol: The appellants, engaged in the manufacture of sugar, molasses, and Ethyl Alcohol, were denied the benefit of Notification 67/95 due to the partial clearance of Ethyl Alcohol on payment of duties and partial use for portable purposes without payment of excise duty. The Tribunal held that the end product being non-excisable without payment of duty, the molasses used in the manufacture of such Alcohol/Spirit were not eligible for the Notification 67/95 benefit. Consequently, a duty demand for the molasses used in portable Alcohol/Spirit production was upheld. Applicability of Notification 67/95 and bar of limitation: The Tribunal rejected the plea of bar of limitation raised by the appellants, emphasizing that the earlier notice did not address the issue of Jurisdictional Assistant Collector's direction to pay duty on molasses ineligible for Notification 67/95. The Tribunal found no grounds to grant the limitation bar as the appellants had evaded duty by wrongly availing an exemption not entitled to them under Notification 67/95. Penalty on Managing Director: Regarding the penalty imposed on the Managing Director, the Tribunal held that the plea of not overseeing day-to-day operations did not absolve the Director of responsibility. The Managing Director is obligated to ensure compliance with laws and written directives, making them liable for penalties related to duty evasion. Therefore, the penalty on the Managing Director was upheld, emphasizing their accountability in duty evasion matters. Conclusion: The Tribunal found no merits in the appeals and consequently dismissed both appeals, affirming the duty demand on molasses and upholding the penalty on the Managing Director for non-compliance and duty evasion.
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