Custom, Excise & Service Tax Tribunal
Prima Papers & Engineering Pvt Ltd vs Commissioner Of Central Excise, Pune I on 16 September, 2010
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH AT MUMBAI COURT NO. Appeal No. E/99/09 (Arising out of Order-in-Appeal No. P1/VSK/260/2008 dated 25.11.2008 passed by Commissioner of Central Excise (Appeals), Pune I.) For approval and signature: Honble Mr.S.S Kang, Vice President ======================================================
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 : __ 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?
====================================================== Prima Papers & Engineering Pvt Ltd Appellants Vs Commissioner of Central Excise, Pune I Respondent Appearance:
Mr Sachin Kulkarni, Associate Finance, for Appellants Shri S.S. Katiya, S.D.R, for Respondent CORAM:
Honble Mr. S.S. Kang, Vice President Date of Hearing: 16.09.10 Date of Decision: 16.09.10 O R D E R NO..
Per: S.S. Kang
1. Heard both sides.
2. The appeal filed by the present appellant is against the impugned order whereby the penalty imposed under Section 11AC of the Act was upheld by the Commissioner (Appeals). Brief facts of the case are that the appellants are engaged in the manufacture of various motor vehicle parts and availed credit of Rs 27,641/-. On 31.8.2005 the Revenue pointed that the documents on the strength on which credit was availed is in the name of other unit of the appellant which is situated in the same locality. The appellant reversed the credit alongwith interest and are not contesting the reversal of credit. The contention of the appellant is that as the duty paying documents are in the name of the appellant and the address was given in the invoice was of other unit which is situated in the same locality and therefore there was no intention to evade payment of duty. Hence penalty under Section 11AC of the Act was not sustainable.
3. The contention of the Revenue is that as the credit was wrongly taken and this fact is admitted by the appellant and therefore they are liable for penalty.
4. I find that the Honble Supreme Court in the case of Union of India vs Rajasthan Spinning & Weaving Mills 2009 (238) ELT 3 (SC) held that mandatory penalty under Section 11AC of the Act is not applicable in every case of non-payment or short-payment of duty. Conditions mentioned in Section 11AC should exist for penalty thereunder. As per the provisions of Section 11AC, where any duty of excise has not been levied or paid or has been short-levied or short-paid or erroneously refunded by reasons of fraud, collusion or any willful misstatement or suppression of facts, or contravention of any of the provisions of the Act or of the rules made thereunder with intent to evade payment of duty, the person who is liable to pay duty as determined is liable to pay a penalty equal to the duty so determined. I find that in the show-cause notice there was no allegation of suppression of fact with intent to evade payment of duty. The show-cause notice simply states why penalty should not be imposed under the provisions of Section 11AC of the Act. There is no allegation of suppression of fact in the show-cause notice and the invoice on the strength of which the credit was availed is in the name of the appellant where the address of the second unit was mentioned which was also situated in the same locality. In any case, the appellants are entitled for credit on the basis of the document in the other unit. In the circumstances, I find that an allegation of suppression, misdeclaration etc with intent to evade payment of duty is not in the show cause notice. The penalty imposed under Section 11AC of the Act is not sustainable hence set aside. The appeal is allowed.
(Pronounced in Court.) (S.S. Kang) Vice President rk 3