Calcutta High Court (Appellete Side)
Maithan Steel & Power Limited (Unit-Ii) ... vs Commissioner Of Central Excise on 25 September, 2014
Author: Harish Tandon
Bench: Harish Tandon
1
8 25.09.14 W.P. 27653 (W) of 2014
akd
Maithan Steel & Power Limited (Unit-II) & Ors.
Vs.
Commissioner of Central Excise,
Bolpur Commissionerate & Ors.
--------
Mr. J. P. Khaitan, Mr. Tanmoy Chakravarty.
... for the petitioners.
Mr. K. K. Maiti.
... for the respondents.
A legal point arose in course of argument advanced by Mr. Khaitan as to whether the Settlement Commission can impose the penalty in excess of Section 11A of the Central Excise Act, 1944.
According to Mr. Khaitan, the petitioners deposited the entire amount of duty and have also paid the interest as per the petitioners' calculation, but so far as the quantum of penalty is concerned, the Settlement Commission has exceeded its jurisdiction and, therefore, the order cannot be sustained.
An ancillary point is also raised that if one of the co-noticees has paid the entire duty and the penalty, whether such payment would enure to the co-noticee under 2nd proviso of Sub-section 2 of Section 11A of the said Act.
Mr. Khaitan drew my attention to the unamended portion of Section 11A of the said Act where the penalty can be imposed to the extent of 25% of the duty liability and according to him, the 2 Settlement Commission cannot direct the payment of penalty in excess thereof.
Mr. Maiti, learned advocate appearing for the respondents, submits that both the provisions, namely Section 11A and Chapter V of the said Act stand differently and the assessee, who submitted to the jurisdiction of the Settlement Commission, cannot fall back to the provisions, which are applicable in the event the adjudication is made by the Central Excise Officer.
This Court feels that the point as indicated above requires consideration.
On the prayer of Mr. Maiti, the respondents are directed to file affidavit-in-opposition within one week after reopening of this Court following Puja Vacation. Reply thereto, if any, be filed within one week thereafter.
Let this matter appear in the supplementary list two weeks after reopening of this Court following Puja Vacation under the heading 'For Orders'.
It appears that the Settlement Commission has demanded a sum of Rs.2,50,00,000/- on account of penalty, which appears to be in excess of 25% of the settled amount of duty.
This Court by way of an interim measure direct the petitioners to deposit a sum of Rs.2,11,00,000/- with the Commissioner of Central Excise, Bolpur Commissionerate within four weeks from date.
The respondents are restrained from taking any steps or coercive measures for recovery of the penalty-
3and-interest from the petitioners for a period of four weeks from date.
In the event, the petitioners deposit the aforesaid sum within the time as indicated above, the interim order passed above shall continue till six weeks after reopening of this Court following Puja Vacation or until further order/orders of this Court, whichever is earlier.
(HARISH TANDON, J.)