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Proceedings Can't Be Initiated When Excise Duty Was Paid Prior To Issuance Of Show Cause Notice: CESTAT
Mariya Paliwala
24 May 2022 9:00 AM GMT
The Kolkata Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) consisting of P.K. Choudhary (Judicial Member) has held that the authorities had no jurisdiction to initiate proceedings as the assessee had paid the excise duty along with the interest prior to the issuance of the show cause notice.The appellant/assessee made clearance of 460 numbers of 'Fish Plate'...
The Kolkata Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) consisting of P.K. Choudhary (Judicial Member) has held that the authorities had no jurisdiction to initiate proceedings as the assessee had paid the excise duty along with the interest prior to the issuance of the show cause notice.
The appellant/assessee made clearance of 460 numbers of 'Fish Plate' during the month of August 2008 to M/s. Era Infra Engg. Ltd., availing exemption under Notification dated 28.08.1995 as amended.
In the course of the audit, the department found that the appellant did not procure any certificate supporting the availment of the benefit of the exemption notification. In the absence of the certificate, it was held that the appellant was ineligible for the exemption in respect of the finished products. A show cause cum demand notice was issued.
The show cause notice recorded that the assessee agreed to the observation of an audit on the issue of clearance of 460 numbers of "Fish Plate" and paid the duty through the Cenvat account. The appellant also paid the interest of Rs. 14,535 against the delayed payment.
Being aggrieved by the Order-in-Original, the appellant preferred an appeal before the Commissioner (Appeals). However, he confirmed the penalty.
The appellant submitted that there was no occasion for the issuance of a Show Cause Notice as the appellant had paid the duty with interest even prior to the issuance of the Show Cause Notice. Though the adjudicating authority appropriated the amount of duty along with interest, he proceeded to impose the penalty in terms of Section 11AC of the Central Excise Act, 1944 read with Rule 25 of Central Excise Rules, 2002 alleging suppression of material facts with the intention to evade payment of duty.
The tribunal, while setting aside the penalty, observed that the allegation in the notice was not supported by evidence, leading to the conclusion that the appellant had suppressed the facts.
Case Title: M/s. Surya Alloy Industries Limited Versus Commissioner of CGST & CX
Citation: Excise Appeal No.76338 of 2018
Dated: 18.05.2022
Counsel For Appellant: Advocate N.K.Chowdhury
Counsel For Respondent: Authorized Representative S.Mukhopadhyay
