Karnataka High Court
Commissioner Of Central Excise vs M/S Geneva Fine Punch Enclosures Ltd on 27 January, 2011
Bench: N.Kumar, Ravi Malimath
IN THE HIGH COURT GF KARNATAKA AT ::3'é§::\a<3;e:.:;'<:}2éE.'%'_"T %
DATED "mxs THE 27"" am '€>F'§A_N'.UAR'f 2'{}_I :1"?
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THEE HQWBLE MR. 3'u§'?:§:E :§J'.'r<:.jM:xR Vi:
"WE HOVNBLE :$m.'3a.;sT :CE ;ii;:\.'\'/;::'V".:§z:,»;2;Lz2\»a;rx":':»+
BETWE. ;
Commissions: of 'C:'2r:t'r'.'¥:{i-~I:EV>A<n:i_s '<+3[.__" __
Bangalore ---I {lammis's.ioz*w::=r'ate--,.__ "
Queens Road, C§R4.B:J,iId'Jng;._V "
Bangaaore_-.550o1:;.A=~' ~ ' ,..AF'f3ELLANT
(£%§§.¥'Srs AY'. ¥-{.{a'ri»-."r'3ra"s5aAd, Aavme;
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v?'T§'vi/s;GeneQz2 Fihe .f5£.;nc§3 Enciosures Ltd,
--«..¥$iva:'s_._i-».& 2, E:;%I;3. Whitefieid,
4: E;an§;a,,I0ré:~.~j 560 066. ..dR;ESPON{)ENT
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T "T"§€§s TCEA fiégé aznsdar gedéesz 33$ §f $28 C@:2tra£
* _A'1E7:;s:::§:§& flat? E944 grayisg is flew the appeai arsfi get agééa
{£916 CESTAT Fmaf 9539:" §xi§,1§i1;'2$E;Q datefi i'43£?A2$}-E3!'
This (SEA coming an far orcfers this day,".%{E}.F%_1s§7E2Z,4J.,
delivered the falihwingz» 'A :.
JUDGMENT
Sri Harésh, the Eearned CV;pur1:se'Alf;i§-._p"é§rfmi£i:e<fi_'''tie.fiie '' pewer for the respohcient.,'
2. This is an ,t_heV"feh§§hjue'ivvfchaEIehging the order {Bagged turh hat aside the order passed- by which had imposed.:h.§:4'éf§:eEh_.ait;f.aiitéé the order cf the i5 a manufacturer of sheet metai :;§C§'efh;3__hr.e:_nt:s,'A"'pa.Iitfs=3' of medicat equipment and fitness ';V'eqgi'vpvfr:eviz€:"'failing under {SSH 8537.00, 9033.06 and "[email protected]ééishggjectiveiy of the First Schefiuie to the Centrai E$<.::s§'e.:_°rar:ff Act, 1985. During the investigation, it was 'Tf'<;z.:hd that the assessee had cleared the raw rhateriafs and gemé fir':é$hed ghhhs far" jet: work is varieus jab wcrkerg éurézag the heréeé {mm fiuéy 23:33 is lame ZSOE &€%§ they 3
5.. -
OOWMBOOWM did not receive them back after completion ef jeb work even after the lapse of the stipulated eerlod of4.:l8§r§_ays and that the assessee did not reverse the approerilatex'e.iiiiyp_ amount payable en these eemiefinished roawv-ifrija.te'ri:ai«s seiitg for job work as stipulated iieder=.,the_-ifAEi'N'Wfi"l..'Cred'i'i;i-rRi;i.¥;eS. They also cleared exeisable -goodsal_'o"r test.tiiig:,vgispoiectionw'2 and approval, etc and itenris' replacement without payrrrent ofVL'Zer:tra*l_V_ during the period April 2802 to August 'i""VhAe:y a.l'soV'se;*:t excisable goods as reglar;errzeei_..__s'arrrplesoppiy; short supply, development sampleW._and aplpre\J'al_,"fitlriess test, inspection, etc during thpedperiedi '-frorn: September 2001 to November 2863 pjaayirrreiit of Central Excise Duty. They also raised 'Vl;§-Eiblt"'il'O:'t?S.:§ZS:lrVal'€fS the rejection of excisable goods but did ri_'ot-irelverse the appropriate Central Excise duty .A payatil-e' on these rejected geecfs on which CENVAT Credit it '~_vVl"i3S: beer: availed by there. Therefore, the tetai iiability of .----}'§{§"'§€ aesessee en the entire goods worked out to Rs.2,é:,§28;'m Sh eeirre painted eat, the asseasee gate r r.
the said duty aee aiso paid the interest there on...o:'-««ft_'h.;;s, the as:-zessee voltzntariiy oaid the duty atzd_-'thte:re1i3t..:' intimated the same with a requestte w~'a'Ei!e"-t'_rje"';~s$t;eup?"» Show cause hotice. It is, thereaifi:er:._;_"a't'sh'te.w"~e§3L:s'e:"tenéo{t:r::e came to be issued to the"é3__S"s'.ezssee'»-owih .1_Ot;'!fi'3";.i;v8OoS..-5 assessee sent a reeiy. conte_n_d'ihg 'that aiready paid the duty and héthoeeefore, they are not iéabte to pay thegsarhe';"*.E--!:§om.?eee,r_,ihttzeghéehessing Authority i.e., Assi:§toht_' the judgment: of the accepted the case of the asseseeedahd' the fact that even before the issgne' of shew_"(:a'use' netéee demanding pehaity, they had «yvo'i:.rnt'§§rEh;*«5:g_aEd thhehhduty and interest and therefore, he did :moot"pa-rorgfzoeei-.te impose any penaity. Aggrieved by the sarhe_,___"'t-he revenue preferred an aooeal before the _ Com.h'z--;ésioner of Central Excise (AppeaEs~«1} who interfered ht the order passed by the Qtiginai Autherity and heié as
--these irregttéerities were hoticed he the eetgtse of émgeetégietioh end the aeseeeee hee dehberateh; evaded £ payment of duty, it was of the view that "mer2§_,...re;~;_:"'i.§;iias proved and penalty is liabie to be imposediéi.'oieo-tire:-é____"a_ reduced penalty of 25%. Aggrie\_ze>d_by d1'e"se§id:o'rder, tfu1ei~ assessee preferred an appeai toV'»i;he::'tri.t§3ui'ia._hEi.-.' °i*§1'e":t'-r_i_be:;j2§iE foflewirig the judgment <3f":';'i'i-€?:__ApexCourt'1ii3A..;Eh.€VVVCi3SEi Union of India vs. Rajasthar7_i:"§;im:;ing'"5134?liweaving Miiis reported in 2009 (v.2'3.i')_AE:I,T2.j_3v:%S{I'}»jheid as there is; no determiria'riona.oVf d:;.t:y*i--.1iebiViity<__i§.ré'der'*.1v'.trie provisions of Section ifiientreff Act and aiso that there a_reiAAVr:'r>V..oaVi:'i«ega.fiEo.r;s_ii7 the impugned notice, the Assessiézfggéi Aiiti"i_oVr'ity }5:'a:S"'j'i}stified in not imposing penalty ar'rd"the Vflorhmissivoner committed a serious error in order and set aside the order of the {":_<,')Efi'iI""514jE'$S!Vi(3IA;}"E?.i*"; Aggrieved by the said order, the revenue ES«.EE"§ 2:;p'o-eel,
4. The iearned Counsel appearing for the revenue, aeseiiirig the imoegned order, contended in the first oiece that in the ghee: cause eoirice ieeoed, die facts are eieerigz gee out aid 3% ie efieariy eiserred that there was a intention on the part of the assessee to evade thJeV.V;:3:a.>;,/aziaent ef duty. Admittediy, the duty was paid ii-*:._._'i'::i_v pointed out by the authorities after' i_nves.tig"a'ti:ehtin"Athese*. circumstances, as the aiiegaitiéohrs'..Eha'd.e assessee has remained "un.r;.haEiVenojed),' mreai"
established and it is he ciear(_eas.e'a.f_vdeEi'be}iate intention to evade duty and was justified in imposing the ';3.gInaity~,"' set aside by the tritauhoaii-...' . "
Section 11~A after a notice is issued under $e-t:tio.h (A) (C), the assessee has a right a te'pres.e'htatieh cehtesting the ciaim. It is, ' .-V't§:e)te~aftet",iiundet Section 11 (A) (2) the Central Excise .WC)"i"i'«ieei9 'aftef considering the representation, if any, made by [.)V8i'SQfi on whom netice is served, determining the AA_Va"m(ouht of duty of excise due from such peraon and thereupon each persen shaft gay the attzeuht S0 determined, Seetieh :1 A (C) makes it (deer that the iéaetiity te eat}: the eettaitig arises ah the eeteeh whe is 3: . -
-.,» ......':,?....
iiatzsie to pay duty as determined under sub--Seetid_n 2 of Secitéon it A.
6. Therefore, the determination of ii§a_b'iiity'V:-tie':
duty is a condition precedent for imposing £i'_aftet~. demand of duty if the assessee w-iteheu4tt_t:o'n'te'strng ciaim voluntariiy pays the-.___dutyV7.and palyavbiéiit» thereon for the delay En of duty fthevfgstfpuiated day, the question {v3I'i~:".'."'Vi=.§l1Ei"'AOfifiE~¢'é'§?V_"d'ét§3'3'Ffiinéng the duty payab'ie"'i'vvdL:iid a'r.£Se. only in cases duty is deterd1._in"e.d 'wiVt'h,:ti.:e.fa<:t that the duty is evaded by a_ reasidntof fr-a.ud;--._it:o~~i'it:sion or any wiitfui mis~statement otfgup_ore.$sion"(ii?--facts or contravention of any of the ' :nrovyiS§--o'n:='_'"efthis Act or the rules made thereunder with intent td.V'V'a1'jey:'ade payment of duty, the iiabiiity to pay pena.§ty'«;_arise, The trébunai in the Enstant case on a ctarefni A n§V(i}'ti;'i'§Ed€i'atiO!'3 of the rnateriai on record has heid féretiy that there is no determénatien ef duty. Seeendiy, the aferesaid requirement Le, the cauee df eeaeion at duty :3 not rrtienttened tn the shew eeuee netteet §:tii"E§'tE':%" that tee E;
eratira duty and interest was paié v<>iuntar_E1_32"'.:§:_;--...:t§'é3i.f§g_ pointed out It heid that no case for Emp_c3~si»n4:jj~tEfié:::pe3n;%{§'y--«.. is made Gut" The Cemmigsiefixgr w:ajé% in "t§3*:aI"Vé'rgf9x:_ it1 passing the order and impeisi-n_g *:hVr"e.V_§:;¥é::naitgr;"V'A' Circumstances, we do not inijthe order passed by the trib1.i:i:fi.'i:A.'* _ qu"e§sV1A;vton of iaw invoived in this appe? §_ CQn5;deramn_ Hence, .' SQ;
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EUEGE F}E'S*