2017 (9) TMI 215 - AT - Central Excise

SSI exemption - N/N. 8/2003-CE dt.01.02.2003 - excess payment made by appellant of ₹ 89,700/- - penalty - Held that - against the total demand of ₹ 6,50,962/- the adjudicating authority appropriated ₹ 89,700/- paid through cash and remaining amount of ₹ 5,61,262/- was appropriated, which was debited in Part-II thus there is excess reversal of ₹ 89,700/- for this amount the Commissioner (Appeals) has already granted the relief, that appellant to seek redressal before the appropriate authority - no further relief is due to the appellant on this account. As regard the penalty imposed under Section 11AC, I am in the agreement with submission of the Ld. AR that after crossing the limit of ₹ 1.50 Crores. The appellant have not taken the reasonable steps for registering themselves and discharging the excise duty. Even though the appellant have been issuing invoices but the details of clearances were not known to the department as neither any registration was obtained nor any periodical returns were filed to the department. Accordingly, there is a clear suppression of fact on the part of the appellant therefore the penalty under Section 11AC was legally imposed by the lower authority which cannot be interfered. Appeal dismissed - decided against appellant.

Summary

Issues: Availing SSI exemption, exceeding threshold limit, non-payment of excise duty, penalty imposition, appropriation of excess payment, waiver of penalty, role of power of attorney holder.

Availing SSI Exemption: The appellant availed the value-based SSI exemption but exceeded the threshold limit of ?1.5 Crores during the financial year 2007-2008. Consequently, they did not discharge the excise duty after crossing the exemption limit.

Non-Payment of Excise Duty and Penalty Imposition: The adjudicating authority confirmed a demand of ?6,50,962/- and imposed an equal penalty of ?6,50,962/- under Section 11AC, with an option of reduced penalty to the extent of 25%. Additionally, a personal penalty of ?25,000/- was imposed on the power of attorney holder. The appellant challenged the penalty and interest, seeking relief, which was rejected by the Commissioner (Appeals).

Appropriation of Excess Payment: The appellant sought the appropriation of excess payment of ?89,700/- against the confirmed demand, which was partially granted by the Commissioner (Appeals) with the liberty to seek redressal at an appropriate forum.

Waiver of Penalty and Role of Power of Attorney Holder: The appellant contended that they did not have any mala fide intention as the goods' clearance was declared to tax departments. The Assistant Commissioner argued that the penalty under Section 11AC was rightly imposed due to the appellant's failure to disclose the removal of goods without payment of duty.

Judgment: The Tribunal upheld the demand of duty as uncontested by the appellant. Regarding the excess payment appropriation, the Tribunal noted the appellant's liberty to seek re-credit with their jurisdictional officer, providing no further relief. The penalty under Section 11AC was upheld due to the appellant's failure to register and discharge excise duty after crossing the exemption limit. The penalty imposed on the power of attorney holder was reduced from ?25,000/- to ?5,000/- considering his role in non-payment of excise duty and overall circumstances. Consequently, the appeal of the appellant was dismissed, while the appeal of the power of attorney holder was partly allowed.