Custom, Excise & Service Tax Tribunal
The Commissioner Of Central Excise vs M/S. R. K. Products on 20 March, 2008
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL SOUTH ZONAL BENCH AT BANGALORE Appeal No: E/25/2007 (Arising out of Order-in-Appeal No: 292/2006 CE dated 12.10.2006 passed by the Commissioner of Central Excise (Appeals), Mangalore.) 1. Whether Press Reporters may be allowed to see 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 CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? Yes 3. Whether their Lordship wish to see the fair copy of the Order? 4. Whether Order is to be circulated to the Departmental authorities? The Commissioner of Central Excise Belgaum. Appellant Vs. M/s. R. K. Products Respondent
Appearance Shri K. Sambi Reddi, Authorized Representative (JDR) for the Revenue.
Shri Pradyumna G. H., Advocate for the Respondent.
CORAM MR. T. K. JAYARAMAN, HONBLE MEMBER (TECHNICAL) Date of Hearing: 20.03.2008 Date of decision:20.03.2008 ORDER No._______________________2008 Per Shri T. K. Jayaraman Revenue has filed this appeal against the impugned Order-in-Appeal No.292/2006 CE dated 12.10.2006 passed by the Commissioner of Central Excise (Appeals), Mangalore.
2. The Central Excise officers visited the respondents unit on 15.9.2003 and found out that there was shortage of goods with reference to the RG-I entries. It was revealed that the respondents had cleared the goods without issuing invoices and without payment of duty. Further, during the relevant period they could have legitimately paid the duty by 5th of the following month but the fact remains that the goods were cleared without invoice. When the irregularity was pointed out, the respondent discharged the duty liability on 6.10.2003. Revenue proceeded against the respondent by issue of show cause notice dated 30.11.2005. The lower authority dropped the penal proceedings on the ground that the respondent had paid the duty even before the issue of show cause notice. Revenue appealed to the Commissioner (A). The Commissioner (A) upheld the order of the lower authority on the same ground. While taking a decision, the Commissioner (A) has relied on this Benchs Final Order No.817-831/2005.
3. The learned departmental representative stated that but for the detection of the irregularity the respondents could have gone scot-free with the clearance of the goods without payment of duty. Even though the respondents had time to pay the duty till the 5th of the following month, the very fact that clearance had been effected without issuing any invoice reveals that the respondent had intention to clear the goods without payment of duty and further they carried out the intention. The learned departmental representative further pointed out that the Final Order relied on by the learned Adjudicating Authority has been issued relying on the RINL case decided by this Bench and affirmed by the Supreme Court. Further, he stated that in those cases no clandestine activity was involved, therefore, it is possible to distinguish the facts of those cases from the present one. He also brought to my notice the following decisions of the Tribunal passed by the President wherein he had distinguished between the cases where clandestine removal was made and those cases where non-payment of duty was due to wrong interpretation of Notification / Law, etc.
(i) CCE, Meerut-I Vs. Parmarth Steel & Alloys (P) Ltd. - 2007 (209) ELT 200 (Tri.-Del.)
(ii) CCE, Ludhiana Vs. Monga Brothers Limited - 2007 (211) ELT 403 (Tri.-Del.)
(iii) Continental Brakes Ltd. Vs. CC, Delhi - 2007 (8) STR 393 (Tri.-Del.)
(iv) Swastik Tubes Pvt. Ltd. Vs. CCE, Kanpur - 2006 (203) ELT 485 (Tri.-Del.)
(v) Larson & Toubro Vs. CCE, Mumbai-II - 2003 (161) ELT 827 (Tri.-Mumbai)
(vi) CCE, Delhi Vs. Toshi Auto Industries Pvt. Ltd. - 2005 (183) ELT 48 (Tri.-Del.) He further made the point that all cases cannot be treated on the same footing. While deciding whether penalty is leviable or not, one has to go into the facts of the particular case and decide the issue in accordance with law.
4. The learned counsel pointed out that the duty was immediately paid in accordance with law when the irregularity was pointed out. Moreover, the department had taken nearly two years to issue show cause notice. Hence, he urged that the impugned order is legal and proper.
5. On a very careful consideration of the issue, I find that even though the respondent had time to pay the duty, the clearance without issue of invoice is irregular. There is a very clear violation of the Central Excise provisions. I agree with the Revenues contention that had the irregularity been not pointed, then Revenue would have lost the duty amounts. Therefore, there is enough justification in imposing some penalty in this case. Taking into consideration the quantum of duty sought to be evaded and also the fact of immediate compliance by the respondent, I order that the respondent should pay penalty of Rs.1,000/- (Rupees One Thousand Only) under Section 11AC. Thus, the Revenues appeal is disposed of on the above terms.
(Pronounced and dictated in open Court) (T.K. JAYARAMAN) Member (T) //rv//