1992 (10) TMI 208 - AT - Central Excise

Summary

Issues:
1. Imposition of penalty and recovery of duty on assessment of RT-12 returns.
2. Validity of invoking Rule 230 and Section 11A for recovery of dues.
3. Adjudication of duty and non-payment leading to imposition of penalty.

Analysis:
The judgment by the Appellate Tribunal CEGAT, New Delhi involved the imposition of penalty and recovery of duty on assessment of RT-12 returns. The Superintendent of Central Excise issued directions to the respondents to pay duty based on the assessment of RT-12. When the respondents failed to comply, a show cause notice was issued for non-payment of duty and imposition of penalty under Rule 173Q. The Asstt. Collector confirmed the duty demands and imposed penalties. The lower appellate authority set aside the orders-in-original on the grounds that the recovery of dues should have been pursued under Rule 230 or Section 11 of the Act, without the need for adjudication proceedings. The lower authority emphasized that penal action could not be taken after the initial assessment through RT-12. The Asstt. Collector's order was quashed, stating that the appeal process should have been followed for challenging the assessment. The Tribunal dismissed the revenue's appeal, agreeing with the lower authority that once duty is adjudged on RT-12 and not paid, penalties cannot be imposed subsequently. Recovery of dues should be through Rule 230 or Section 11, and penal actions are not warranted in such cases.

The main issue addressed was the validity of invoking Rule 230 and Section 11A for the recovery of dues. The lower appellate authority emphasized that for recovery of assessed dues, measures under Rule 230 or Section 11 should be utilized without the need for separate adjudication proceedings. The Tribunal concurred with this view, stating that once duty is adjudged on RT-12 and remains unpaid, penalties cannot be imposed subsequently. The Tribunal upheld the lower authority's decision and dismissed the revenue's appeal, highlighting that recovery of dues should be pursued through the appropriate statutory provisions without resorting to penal actions.

Another crucial issue was the adjudication of duty and non-payment leading to the imposition of penalties. The Tribunal emphasized that once duty is adjudged on RT-12 returns and the assessee fails to pay, penalties cannot be imposed by the revenue as done in this case. The Tribunal reiterated that recovery of dues should be made through Rule 230 or Section 11, without the need for penal actions. The Tribunal's decision upheld the lower appellate authority's ruling, emphasizing that penalties cannot be imposed after the initial assessment through RT-12 if the duty remains unpaid. The judgment emphasized the importance of following the appropriate statutory provisions for the recovery of dues without unnecessary penal actions.