Custom, Excise & Service Tax Tribunal
Commissioner Of Central Excise, ... vs M/S. Tejoomal Industries Ltd on 10 August, 2016
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH AT MUMBAI COURT NO. Appeal No. C/693/05 (Arising out of Order-in-Original No. 03/COMMR/04-05 dt. 28.04.2004 passed by the Commissioner of Central Excise, Raigad ) For approval and signature: Honble Shri Ramesh Nair, Member (Judicial) Honble Shri Raju, Member (Technical) =======================================================
1. Whether Press Reporters may be allowed to see : No
the Order for publication as per Rule 27 of the
CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the : No
CESTAT (Procedure) Rules, 1982 for publication
in any authoritative report or not?
3. Whether Their Lordships wish to see the fair copy : Seen
of the Order?
4. Whether Order is to be circulated to the Departmental : Yes
authorities?
=======================================================
Commissioner of Central Excise, Customs & Service Tax, Raigad
:
Appellant
VS
M/s. Tejoomal Industries Ltd.
:
Respondent
Appearance
Shri Ahibaran, Addl. Commr. (A.R.) for Appellant
None for respondent
CORAM:
Honble Shri Ramesh Nair, Member (Judicial)
Honble Shri Raju, Member (Technical)
Date of hearing : 10/08/2016
Date of decision : 10/08/2016
ORDER NO.
Per : Ramesh Nair
This appeal is filed by the Revenue against the Order-in-Original No. 03/COMMR/04-05 dt. 28.04.2004 passed by the Commissioner of Central Excise, Raigad. The Revenue is in the appeal seeking relief that the adjudicating authority though confirmed the demand on 100% EOU for the period August 1993 to July 1997 in respect of imported raw material and capital goods on the ground that imported goods were cleared under exemption Notification No. 13/81-Cus. Dt. 09.02.1981 as the goods were not put to use and the export obligation has not been fulfilled. However, the Ld. Commissioner even though a penalty was proposed under Section114A of the Customs Act, 1962 but has imposed penalty of Rs.25,00,000/-, which otherwise should be not less than the equal amount of duty confirmed i.e. Rs.68,22,953/-. The another issue in the appeal is that though the adjudicating authority in Para 15 of the impugned order held that interest under Section 28AB is recoverable on the duty payable but in the operating portion of the order, the interest demand was not confirmed.
2. Shri Ahibaran, Ld. Additional Commissioner (A.R.) appearing on behalf of the Revenue reiterates the grounds of appeal. He further submits that as per the Honble Supreme Court decision in the case of Union of India Vs. Rajasthan Spinning & Weaving Mills 2009 (238) E.L.T. 3 (S.C.), Commr. Of. Cus. (Exports), Chennai-I Vs. K.R.M. International Ltd. 2014 (309) E.L.T. 456 (Mad.), Union Of India Vs. Dharmendra Textile Processors 2008 (231) E.L.T. 3 (S.C.), the mandatory penalty provided under the statute equal to the duty cannot be reduced. He further submits that there is apparent mistake on the part of the adjudicating authority that he has not confirmed the interest under Section 28AB of the Customs Act even though he held in the Para 15 of his finding that interest is payable by the appellant under Section 28AB of the Customs Act.
3. None appeared on behalf of the respondent despite notice.
4. We have carefully considered submissions made by Ld. A.R. and perused the record. We find that in the show cause notice in connection with the demand of Customs duty, a penalty was proposed under Section 114A of the Act. In the adjudication order also the Ld. Adjudicating Authority imposed penalty under Section 114A of the Act. Section 114A is reproduced below:
SECTION 114A. Penalty for short-levy or non-levy of duty in certain cases. - Where the duty has not been levied or has been short-levied or the interest has not been charged or paid or has been part paid or the duty or interest has been erroneously refunded by reason of collusion or any wilful mis-statement or suppression of facts, the person who is liable to pay the duty or interest, as the case may be, as determined under sub-section (8) of section 28 shall also be liable to pay a penalty equal to the duty or interest so determined :
From the above Section 114A of the Act, it is clear that under this Section the penalty should be mandatorily equal to the duty short paid or non-paid. In the present case the duty in the adjudication order confirmed is Rs. Rs.68,22,953/- whereas the Ld. Commissioner under Section 114A of the Customs Act, 1962 imposed penalty of Rs.25,00,000/- which is not in accordance to the provisions of Section 114A of the Act. On this issue the Honble Supreme Court in the case of Rajasthan Spinning & Weaving Mills (supra) and Dharmendra Textile Processors (supra) held that the mandatory penalty provided under Section 11AC which is pari materia to Section 114A cannot be reduced from equal amount of duty short paid or non-paid. Therefore the Ld. Commissioner has wrongly imposed reduced penalty. We hold that the appellant is liable to pay the penalty under Section 114A equal to the duty confirmed in the adjudication order. As regard interest, it appears that there is an apparent error on the part of the adjudicating authority that despite clearly holding that the interest is recoverable on duty payable under the provisions of Section 28AB of Customs Act 1962 in Para 15 of the impugned order, it was left from mentioning in the operating portion of the order. Therefore, we order that appellant is liable to pay interest under Section 28AB on the confirmed duty amount of Rs. 68,22,953/- in accordance with law. The impugned order stands modified to the above extent. Revenues appeal is allowed.
(Pronounced in court) (Raju) Member (Technical) (Ramesh Nair) Member (Judicial) SM.2
C/693/05