Customs, Excise and Gold Tribunal - Tamil Nadu
E.I.D. Parry (India) Ltd. vs Collector Of Central Excise on 13 October, 1989
Equivalent citations: 1990(47)ELT152(TRI-CHENNAI)
ORDER V.P. Gulati, Member (T)
1. This is an appeal against the order of the Collector of Central Excise (Appeals), Madras, dated 29-4-1988, under which levy of penalty of Rs. 100 has been upheld.
2. The penalty has been levied in respect of the events which took place in 1978-79 when the appellant had been allowed to avail of the benefit of Notification 71/78 and in terms of that Notification they were eligible for the benefit of the total exemption upto Rs. 5 lakhs and thereafter, since the clearances in the year for specified goods viz. Car-bondioxide were less than Rs. 13.75 lakhs, they paid duty. The appellants, however, paid duty even for the clearances which were within the Rs. 5 lakhs limit and claimed refund thereof later. Taking into account, however, the total quantum collected from the customers, the refund amount was modified and refund was sanctioned although for a lesser amount. The duty element which was collected from the customers in respect of the goods which were claimed to be eligible for the benefit of the Notification was reckoned for the purpose of arriving at the value of the clearances. In view of this the Rs. 5 lakh limit was also taken to have been crossed by the appellants earlier than what was declared by the appellants to the authorities. To that extent some duty became leviable in respect of the clearances which were made beyond the Rs. 5 lakh limit and claimed to be within the exemption limits according to the working of the limit of Rs. 5 lakhs by the appellants. After making various adjustments, the net amount of refund of Rs. 1,78,017.80 was allowed as against Rs. 1,93,251.24 claimed by the appellant. The appellants, however, went in appeal against the finding of the lower authority regarding the lesser amount due as refund and the Collector (Appeals), however rejected their appeal. The appellants went in appeal further and the Tribunal in their order also rejected their appeal. However, the learned Consultant pleads that at the time of hearing the appeal before the Tribunal the Departmental Representative raised a new point that the appellants were not eligible for the refund at all as the total value of their clearances of specified goods from various factories exceeded Rs. 13.75 lakhs and the Tribunal refused to take note of this new plea. The Departmental authorities apparently after the hearing of the case before the Special Bench of the Tribunal, issued a show cause notice alleging that the appellants had mis-declared the value of the clearances of the year 1977-78 and availed of the benefit of Notification 71/78, dated 1-3-1978 wrongly. This plea was not countenanced by the Tribunal in the proceedings in which the appellants went in appeal as this plea could not be raised at the appeal stage. The learned Consultant pleads that inasmuch as the proceedings had acquired finality with the order of the Tribunal no penal proceedings could be drawn thereafter by the lower authorities. He further pointed out that no violation of any rule in the show cause notice has been set out warranting the levy of the penalty. He, therefore, has requested for setting aside the penalty of Rs. 100 levied on the appellants.
3. The learned Senior D.R. for the Department pleaded that in principle there should be no objection to the institution of penal proceedings separately from the proceedings relating to the demand of duty although it is better if the two proceedings are drawn together. In the present case, however, he pleads that inasmuch as the matter had acquired finality with the order of the Tribunal in propriety of things the penal proceedings need not have been drawn.
4. I observe that the appellants have been charged in 1986 with mis-declaration in regard to their total quantum of clearances in respect of the clearances made in 1978-79. The matter had been gone into in depth by the authorities at different levels and at no stage there was any whisper in the refund proceedings that any element of mis-declaration or suppression on the part of the appellants was involved. The Tribunal also did not countenance the belated plea of the Revenue that there was an element of mis-declaration for the purpose of eligibility to the benefit of Notification 71/78 and that the appellants' total clearances in 1977-78 from all units were to be taken into reckoning and that there was a mis-declaration of the total clearances for the purpose of the benefit of the Notification. I find while there can be no estoppel in taxation matter, so far as the penal proceedings are concerned, these certainly have to be drawn within a reasonable time. In the case when the facts were fully gone into by the authorities and they did not feel that such a course of action as levy of penalty was called for, and after the appellants' explanations were accepted and all the facts were before the authorities, and also when in the show cause notice also no specific violation of any rule has been cited warranting levy of the penalty, the penal proceedings drawn are mis-conceived. Inasmuch as, as pointed out by both the sides, the issue had already acquired finality and in the refund proceedings the plea that the total value of the clearances were wrongly declared was not stated to be there, it was not proper for the Assistant Collector to have initiated penal proceedings on the same issue. I hold in the facts and circumstances of the case the levy of penalty is bad in law and accordingly set aside the same. In the result the appeal is allowed.