2017 (7) TMI 937 - AT - Central Excise

SSI exemption - crossing of exemption limit - it was alleged that the appellant was clearing the goods without payment of duty even after the turnover of the appellant s unit at Bangalore and Hosur put together had exceeded the exemption limit of one crore rendering themselves ineligible for SSI exemption under N/N. 08/03-CE dated 01.03.2003 - Held that - According to the appellant they have cancelled the two invoices No.18 & 19 and therefore the clearances shown therein are not to be considered for the purpose of value of clearances - appeal dismissed - decided against appellant.

Summary

Issues:
- Appeal against penalties under Rule 25 and 26
- Availing SSI exemption under Notification 08/2003-CE
- Clearing goods without payment of duty
- Investigation by Department officers
- Confirmation of demand by adjudicating authority
- Rejection of appeal by Commissioner (Appeals)

Analysis:
The judgment pertains to an appeal against penalties imposed under Rule 25 and 26 by the Commissioner (Appeals) in a case involving the appellant, a proprietary concern engaged in manufacturing Control & Relay panels, Low Tension distribution boxes, Annunciator panels & metering boxes. The appellant was availing the benefit of SSI exemption under Notification 08/2003-CE. The issue arose when it was discovered that the appellant had cleared goods without payment of duty, despite exceeding the exemption limit of one crore, rendering them ineligible for the SSI exemption. The Department officers conducted an investigation, leading to the issuance of a show-cause notice dated 14.12.2008.

During the proceedings, the appellant paid a certain amount towards possible duty liability. The adjudicating authority confirmed the demand, prompting the appellant to file an appeal before the Commissioner (Appeals), who ultimately rejected the appeal. The appellant contended that the impugned order did not consider crucial evidence, particularly two cancelled invoices, which, if excluded, would significantly reduce the duty liability. The appellant had paid interest and penalty as per law on the revised duty amount.

The Commissioner (Appeals) based the order on verification and detailed reasons provided in the order. The dispute primarily revolved around the quantification of duty, with the appellant arguing that the two cancelled invoices should not be considered for calculating the duty. However, the Commissioner (Appeals) found that the invoices were cleared goods, and the appellant failed to provide evidence supporting the cancellation of purchase orders or non-receipt of goods by customers. Consequently, the impugned order was upheld, dismissing the appeal of the appellant.

In conclusion, the judgment upheld the penalties imposed under Rule 25 and 26, emphasizing the importance of providing substantial evidence to support claims during investigations and appeals in excise duty matters. The decision highlighted the need for thorough documentation and compliance with excise regulations to avoid penalties and disputes.