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TMI Blog2019 (9) TMI 1150X X X X Extracts X X X X X X X X Extracts X X X X ..... dismissed the appeal filed by the Appellant challenging the order passed by the Commissioner of Central Excise and Sales Tax, Mumbai dated 18 August 2010 imposing penalty and confirming the demand made against the Appellant. 2. The questions urged by the Appellant as question of law are as under: (a) Whether in the facts and circumstances of the present case, the Tribunal was correct and justified in upholding the demand of penalty failing to appreciate that the reason for short payment of duty was error in the software system i.e. SAP-ERP system maintained at the two units and there was never any intention to evade payment of duty? (b) Whether in the facts and circumstances of the present case, the Tribunal was correct and justified i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty of monthly payment of duty in terms of Rule 8 of the Central Excise Rules, 2002 in respect of finished goods which are removed from the Units. The Appellant gets clearance details from two Units based on the details of the software system established. 5. The Officers of Preventive Wing, Belapur Commissionerate visited Appellant's units on 16 December 2005. According to the Preventive Commissionerate, the Appellant had evaded excise duty. Statements of the staff of the Appellant were recorded. A show-cause notice was issued to the Appellant on 26 February 2008. The notice called upon the Appellant to show cause as to why demands specified therein be not recovered from the Appellant. In respect of Unit No.1, the total duty demanded for th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t Rules, 2002 be not imposed on the Appellant. 7. The Appellant filed reply to the show-cause-notice on 22 April 2008. A personal hearing was given to the Appellant on 28 April 2009. The Commissioner by an order dated 18 August 2010 confirmed duty demand of Rs. 4,70,86,782/- and cess of Rs. 7,12,364/along with applicable interest of Rs. 1,04,17,650/-. By a corrigendum dated 14 September the Commissioner corrected the impugned order. The Appellant by letters dated 15 September 2010 and 24 September 2010 placed on record that 25% of the penalty amount was paid by them by way of challan. 8. The Appellant filed an appeal bearing No.E/1971/2010 before the Tribunal. The Tribunal by the impugned order dated 26 November 2018 partly allowed the ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rge number of matters, the Division Bench considered the question in extenso. The Division Bench followed the judgment of the Supreme Court in the case of Union of India v. M/s. Rajasthan Spinning & Weaving Mills 2009 (239) ELT 3 (SC). The Division Bench rejected the argument that if the amount is paid before the issuance of show-cause-notice or after show-cause-notice, there is no requirement for determination. In case of Commissioner of Central Excise v. Prudential Spinners Ltd. 2011 (267) ELT 291 (SC), the Supreme Court laid down that even if the duty which was short paid was deposited at the first instance even before the show-cause-notice is issued, it cannot alone be a ground for not levying any penalty. The Tribunal has relied upon t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Appellant. 12. We now turn to the other questions (b) and (c). These are in respect of the contention of the Appellant that transaction of unfinished goods between two Units of the Appellant being revenue neutral, no demand of penalty could have been levied. 13. It is the case of the Appellant that entire amount of duty paid by Unit No.1 on polyester film cleared to Unit No.2 is taken as Cenvat Credit to Unit No.2. The Appellant contended that whatever duty is paid by Unit No.1 on clearance of polyester film to Unit No.2 is available as credit to Unit No.2. The demand has been raised in respect of polyester film cleared by Unit No.1 to Unit No.2. The demand has been raised for differential duty of pre-treated polyester film in jumbo r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o contend that the transaction being revenue neutral, no penalty should have been imposed. 17. The Tribunal has not dealt with the specific contention raised by the Appellant on revenue neutrality. Therefore, as far as this ground is concerned, the order of the Tribunal is non-speaking. The Tribunal ought to have, after referring this specific contention of the Appellant, dealt with the same on merits. In these circumstances, we will have to answer question (c) in favour of the Appellant. Since the Tribunal has not considered the ground raised by the Appellant on revenue neutrality, the appeal will have to be remanded to the Tribunal for consideration of the issue recorded in respect of the contention raised in paragraph-3.2(i) of the impu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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