Dismissed

Commissioner of Central Excise v. M/S Beas Scietific Dyers

Punjab & Haryana HC9 Jan 2012CEA/1/2012

Case brief

AI extract

What is this about?

The High Court dismissed the appeal filed by the Commissioner of Central Excise. The Tribunal's order granting the assessee the benefit of a reduced penalty by depositing within 30 days was held lawful. No legal infirmity was found, and the appeal was dismissed as not raising a substantive question of law.

What did the court decide?

The appeal filed by the Commissioner of Central Excise is dismissed as it does not raise any question of law.

Commissioner of Central Excise Vs M/S Beas… — Banking and Recovery | Punjab & Haryana HC (2012)

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CEA 1 of 2012

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IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH.

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CEA No.1 of 2012 Date of decision 9.1.2012

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Commissioner of Central Excise

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. Appellant

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Versus

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M/s Beas Scientific Dyers

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.. Respondent

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CORAM: HON'BLE MR. JUSTICE M.M.KUMAR HON'BLE MR. JUSTICE AJAY KUMAR MITTAL

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Present: Mr.HPS Ghuman, Central Government Standing Counsel for the appellant

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To be referred to the Reporter or not ?

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Whether the judgement should be reported in the Digest ?

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M.M.KUMAR,J.

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The Customs, Excise and Service Tax Appellate Tribunal, New Delhi (for brevity 'the Tribunal') vide impugned order dated 5.1.2011 (A.6) has merely granted statutory right to the assessee namely M/s Beas Scientific Dyers to deposit the amount of penalty under Section 11 AC of the Central Excise Act, 1944 (for brevity 'the Act'). According to the principal clause of the aforesaid provision penalty equivalent to the amount of duty could be imposed. However, the amount of penalty to be deposited is reduced to 25% if it is deposited within a period of 30 days from the date of receipt of notice of demand. In the show-cause notice raising the demand and imposing penalty nothing was indicated regarding the benefit of depositing the amount within 30 days. The operative part of the order issued by the Assistant Commissioner, Central Excise Division No.3, Ludhiana reads as under:

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“1. I confirm demand of Central Excise Duty amounting to Rs. 279135/- against M/s Beas Scientific Dyers, New Shakti

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CEA 1 of 2012

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Nagar, Ludhiana and adjust the same against the amount already deposited by them vide TR-6 Challan No. 1 dated 01.10.2003.

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I impose penalty amounting to Rs. 278135/- on M/s Beas Scientific Dyers, New Shakti Nagar, Ludhiana.

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I also impose a penalty amounting to Rs. 100000/- (Rupees one lac only) on Sh. Ashok Kumar, Partner, M/s Beas Scientific Dyers, New Shakti Nagar, Ludhiana.

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Sd/-

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Assistant Commissioner”

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A perusal of the aforesaid order would show that the assesseerespondent would have no option except to comply with the demand or face other consequences. The order of the Assistant Commissioner was affirmed by the Commissioner (Appeals) vide order dated 28.4.2005 (A.3). However, the Tribunal remanded the matter vide order dated 23.4.2007 (A.4). On remand, the Commissioner (Appeals) again affirmed the amount of penalty being equivalent to the amount of duty. However, the Tribunal vide impugned order dated 5.1.2011 rectified the order by holding that the assessee- respondent may pay the penal amount within 30 days from the date of the order failing which the penalty payable shall be equivalent to the amount of duty.

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We have heard learned counsel for the revenue at some length and are of the view that once an earlier order was not passed in accordance with the provisions of Section 11 AC of the Act then the Tribunal was fully justified in granting one opportunity to the assessee to pay the amount of penalty in terms of proviso to Section 11 AC of the Act within a period of

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CEA 1 of 2012 3

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30 days by earning the benefit of paying penal amount to the extent of 25% instead of amount equivalent to the amount of duty. We find that the order of the Tribunal does not suffer from any legal infirmity warranting interference of this Court. The appeal is wholly mis-conceived and the same is accordingly dismissed as it does not raise any question much less a substantive question of law within the meaning of Section 35 G of the Act.

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9.1.2012 okg

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(Ajay Kumar Mittal) Judge

Commissioner of Central Excise v. M/S Beas Scietific Dyers

Case brief

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Commissioner of Central Excise v. M/S Beas Scietific Dyers

Case brief

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