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TMI Blog2015 (7) TMI 710X X X X Extracts X X X X X X X X Extracts X X X X ..... l Excise Act, 1944. 4. Whether interest on duty not paid is chargeable under Section 11-AB of the Central Excise Act or not." 3. Briefly stated the facts of the present case are that the respondent is engaged in manufacturing of shampoos. His business premises was visited by a team of Central Excise Preventive Officer, Moradabad on 16.9.1996. During the course of checking it was found that the respondents were engaged in the manufacturing of excisable goods (shampoo) since the year 1989. They manufactured shampoos in various brand names, namely (i) Dena Ji Brand Satritha shampoo, (ii) Dena Ji Brand Harbal shampoo (iii) Dena Ji Brand Neem shampoo. These goods were being sold in plastic bottles of capacity 1000 ml, 500 ml, 300 ml, 280 ml, 150 ml and 100 ml. The department found the preparation of these shampoos as meant for use on hair and classifiable under chapter heading No. 3305.90 and subsequently under chapter heading no. 3305.99 of the Central Excise Tariff Act, 1985 and, therefore, liable to central excise duty at the rate applicable from time to time. Statement of Sri Ajai Kumar Gupta, Manager of the unit of the respondent was recorded, who inter alia stated that the unit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 170.92/- on goods already cleared clandestinely without payment of duty is liable to be recovered from M/s DJS. In addition M/s DJS is also liable to pay interest under Section 11AB(though misquoted as Section 11AA) of the Central Excise Act, 1944 since the substance of interest is mentioned in the SCR the interest liability can rightly be recovered from them as settled by no. of judicial pronouncements viz. SAIL Vs. Collector 1988 (38) ELT 488 (T), Jay Engg. Works Vs. GOI 1979 (4) ELT(6307) (AP)5 etc. Further I find party has failed to inform the deptt. about the manufacture of excisable goods, did not obtain Central Excise licence/registration as required under rules and clandestinely removed excisable goods without due discharge of Central Excise duty liability leviable thereon and thus, failed to discharge their statutory obligation and is therefore liable for penal action under rule 173 of the Central Excise Rules for contravention of the provisions of the Rules ibid. I also find that the seized goods manufactured in violation of rules as quoted in brief facts earlier as detailed in the notice are liable to confiscation under Rule 173 and S/Shri D.N. Gupta. Secretary, Ajay Kum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... demand of duty may be revised, if any". (b) In the present case also in the Order-in-Original the Commissioner has observed as follows:- "M/s DJS had not informed the Deptt. about the manufacture of these excisable goods. They had not obtained Central Excise Licence/registration. They had thus deliberately suppressed material information from the Deptt. and cleared the goods clandestinely without payment of duty. Extended period of limitation has threfore, been rightly invoked". (c) Since the appellants are relying upon the order No. 812-813/99-C dated 18.8.1999 and we find that this order can be relied upon for the purpose of coming to the conclusion that in the fact of this case also, is no cause for us to deffer as regards the classification and to find that there are no grounds to invoke the larger period of limitation. 7. In view of our findings the Order-in-Original is, therefore, set aside as regards the demand, the classification as determined in this order under heading 3305.99 of the Central Excise Tariff Act, 1985 is confirmed. The appeals are allowed in above terms." 8. Against the aforesaid order of the Tribunal, the applicant filed a Central Excise Reference App ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the product manufactured by respondent assessee to be covered under heading 3305.99 of the Central Excise Tariff Act, 1985. Thus it is undisputed that the goods in question were excisable and the clearances made attracted central excise duty of Rs. 1,70,05,170.92. 14. The only ground on which the tribunal allowed the appeal of the respondent-assessee was that in case of another assessee a final order No. 812-813/99-C dated 18.9.1999 was passed in which the adjudicating authority of that assessee recorded a similar finding that the assessee failed to inform the department about the manufacture of product under consideration, which was not at part with suppression of material facts for evasion of duty. The Tribunal, although quoted a passage from the order in original in question of the respondent-assessee but did not apply its mind on the findings recorded by the adjudicating authority in the case of respondent-assessee. It mechanically followed the above referred final order dated 18.8.1999 passed in another case. 15. In the show cause notice a clear allegation of deliberate suppression of production and clearance of excisable goods and evasion of central excise duty were made. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er in original. Under the circumstances the order of the Tribunal suffers from manifest error of law and the finding recorded with respect to the extended period of limitation is bad. It is also relevant to note that on the question of classification the Tribunal itself has found that the stand in regard of department is correct. There remained no dispute that the goods in question were excisable goods and therefore removal of such goods without paying duty was in contravention of the provisions of the Act and Rules applicable and, therefore, the condtions mentioned under Section 11 A(1) of the Act were satisfied. Thus the extended period of limitation under the proviso to Section 11A(1) of the Act was lawfully invoked. The respondent-assessee is liable to interest and penalty in accordance with law. 19. In view of the above discussions, the questions of law No. 1 is answered in affirmative i.e. in favour of the applicant department and against the respondent-assessee. 20. Since the Tribunal has not recorded any finding in its final order on the questions of quantification of duty, penalty and interest and therefore, the questions of law No. 2,3 and 4 are returned unanswered leav ..... X X X X Extracts X X X X X X X X Extracts X X X X
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