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2022 (8) TMI 700 - AT - Central ExciseLevy of penalty - delay in filing ER-1 returns - violation of Rule12 (1) of Central Excise Rules, 2022 and of Rule 12 (6) of Central Excise Rules, 2022 of Central Excise Act - intent to evade present or not - HELD THAT - No doubt Rule 12 is silent about the element of intent. But the above facts clarifies that present is not the case of evasion of duty nor even the case of non-filing the requisite returns for the period in question. The only issue is that despite that the appellant was filing GST Returns but has failed to file the ER Returns for the same period - There is a substantial compliance on part of appellant to all the legal provisions which were in effect during the impugned period. Interest of justice requires that Rule 12 (6) of Central Excise Rules 2002 would not have been invoked. The imposition of late fee is nothing less than imposition of penalty. Penalty is a grave word which should be imposed only in case of apparent mala fide fraud, suppression of facts, misrepresentation etc. There is nothing apparent in this case on the part of the appellant. Appeal allowed.
Issues:
Imposition of penalty under Rule 12 (6) of Central Excise Rules, 2002 for delay in filing ER-1 Returns. Analysis: 1. The appellant, engaged in manufacturing excisable goods, failed to file ER-1 Returns from July 2017 to February 2018, resulting in a proposed late fee and penalty. The appellant contended that the delay was unintentional due to transitioning to the GST regime. 2. The Departmental Representative (D.R.) acknowledged the delay but emphasized that the intent is irrelevant for Rule 12 of the Central Excise Act, supporting the findings of the Commissioner (Appeal) and urging dismissal of the appeal. 3. The appellant cited two decisions by the Tribunal, M/s. Jhanki Lal Babu Lal Biri Factory and M/s. Naval Baheria Biri Works, which were similar cases where penalties were deemed unjustified. The appellant sought benefit from these decisions. 4. The Tribunal noted that the appellant had been compliant with filing ER-1 Returns until the GST regime's onset, after which the confusion arose. The Tribunal emphasized that there was no deliberate evasion or non-filing of returns, but a lapse in filing ER Returns while complying with GST requirements. 5. Rule 12 (6) of Central Excise Rules, 2002 was invoked for the penalty, but the Tribunal found that the appellant's actions did not warrant such a penalty. The Tribunal highlighted that penalties should be reserved for cases involving fraud, suppression, or misrepresentation, which were absent in this case. 6. Citing the decisions in M/s. Jhanki Lal Babu Lal Biri Factory and M/s. Naval Baheria Biri Works, the Tribunal concluded that the penalty imposed was unwarranted and set aside the order, allowing the appeal. 7. In concurrence with the findings of the aforementioned decisions, the Tribunal held that the penalty for the delay in filing ER-1 Returns was unjustified, emphasizing the lack of malice or deliberate non-compliance on the appellant's part. 8. The Tribunal ruled in favor of the appellant, setting aside the penalty imposed under Rule 12 (6) of Central Excise Rules, 2002, based on the lack of evidence of fraudulent intent or deliberate non-compliance, as established in similar cases decided by the Tribunal. This detailed analysis of the judgment provides a comprehensive overview of the issues involved and the Tribunal's decision regarding the imposition of penalties for the delay in filing ER-1 Returns under the Central Excise Rules.
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