Custom, Excise & Service Tax Tribunal
Indian Additives Limited vs Commissioner Of Gst&Amp;Cce(Chennai ... on 26 September, 2018
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IN THE CUSTOMS, EXCISE AND SERVICE TAX
APPELLATE TRIBUNAL
SOUTH ZONAL BENCH AT CHENNAI
Appeal No. : E/40047 & 40048/2018
(Arising out of Order-in-Appeal Nos. 207/2017 (CTA-I) & 197/2017
(CTA-I) dated 09.10.2017 & 05.10.2017 respectively passed by the
Commissioner of G.S.T. & Central Excise (Appeals-I), Chennai)
M/s. Indian Additives Ltd. : Appellant
Vs.
The Commissioner of G.S.T. & Central Excise, : Respondent
Chennai North Commissionerate Appearance:-
Ms. Radhika Chandra Sekhar, Advocate for the Appellant Shri. R. Subramaniyan, AC (AR) for the Respondent CORAM:
Hon'ble Shri P Dinesha, Member (Judicial) Date of Hearing/Decision:24.09.2018 Date of Pronouncement: 26.09.2018 Final Order No. 42511-42512 / 2018 The assessee has filed these appeals against the Orders of the Commissioner of G.S.T. & Central Excise (Appeals-II), Chennai, who, vide the impugned Orders dated 09.10.2017 and 05.10.2017 has upheld the demand, interest and penalty and thereby the Orders-in- Original, passed by the adjudicating authority. 2
2. When the matter came up for hearing, Ms. Radhika Chandra Sekhar, Ld. Advocate, appeared for the appellant and Shri. R. Subramaniyan, Ld. Department Representative (DR), appeared for the Revenue.
3.1 Ld. Advocate Ms. Radhika Chandra Sekhar submitted that the appellant is a manufacturer of lubricating oil additives and is availing CENVAT Credit on inputs, namely, Ethylene Carbonate, Glyssopal, IALPHEX, etc., under CENVAT Credit Rules, 2004. A Show Cause Notice dated 21.02.2006 proposing to demand, on account of alleged disproportionate in respect of the inputs physically found to be short of book balance, was issued by the Revenue. The proposals in the Show Cause Notice were confirmed after due process of law in Order-in-Original dated 26.07.2006 against which an appeal was filed before the Commissioner of G.S.T. & Central Excise (Appeals-I), Chennai, who, vide the impugned Order upheld the findings of the Original Authority. 3.2 Ld. Advocate fairly submitted that for the earlier year, the matter had travelled up to the High Court and the Hon'ble jurisdictional High Court vide Order in C.M.A. Nos. 1122-1125/2017 dated 23.01.2018 had ruled against the assessee; that in view of the fact that the issue involved being an interpretational one which was 3 finally laid to rest by the Hon'ble High Court (supra) and hence, prays that the penalty imposed requires to be set aside. 4.1 Per contra, Ld. DR Shri. R. Subramaniyan supported the findings of the lower authorities. He further submitted that this Bench of CESTAT had upheld the disallowance for the earlier period vide Order dated 13.02.2015. The appellant having known the result, ought to have come forward to pay the duty and interest in time and the assessee having not proved its bona fides in the above manner, penalty imposed is therefore required to be upheld. He also submitted that penalty deleted in the earlier year cannot have a cascading effect for subsequent periods as well, since the matter on merits has been laid to rest.
5. I have heard both sides and considered the rival contentions, perused the records and have also gone through the judgment/Order of this Bench for the earlier period in the appellant's own case in Final Order No. 41779-41780/2018 dated 11.06.2018. Though I find that the contentions of the Ld. DR are well-founded, but as could be seen from the records, the Order-in- Original was passed on 26.07.2006 and the Order-in-Appeal came to be passed on 09.10.2017 whereas, the Hon'ble jurisdictional High Court passed its Order on 23.01.2018. Hence, a reasonable view 4 could be adopted at least for this year/period, to hold that the matter which involved interpretational issue came to be settled after passing of the Order-in-Appeal which is impugned herein and that could be a ground to hold that there was no mala fide intention of evading duty by the appellant.
6. I am therefore of the view that the demand raised against the appellant and the consequential interest levied by the adjudicating authority requires no interference, but however, accepting the plea of the Ld. Advocate and following the Order of this Bench in the appellant's own case (supra), penalty imposed is held to be unwarranted and requires to be set aside which I hereby do.
7. In the result, the appeals are partly allowed only to the extent of setting aside the penalty.
(Pronounced in open court on 26.09.2018) (P Dinesha) Member (Judicial) Sdd