Shradha Steels Vs. the Commissioner of Central

Shradha Steels vs The Commissioner of Central

Type Court Judgment Court Customs Excise and Service Tax Appellate Tribunal CESTAT Mumbai Decided Apr 10, 2006

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Citation: sooperkanoon.com/42399
Court: Customs Excise and Service Tax Appellate Tribunal CESTAT Mumbai
Judge: T Anjaneyulu
Decided On: Apr 10, 2006
Subject: Excise

Case Summary

AI-generated summary - not the official court judgment text.

Excise

Key legal issue: Excise

Parties & Advocates

Appellant / Petitioner

Shradha Steels

Respondent

The Commissioner of Central

Legal References

Reported In: (2006)(110)ECC376

Excerpt

.....scheme as per the section 3a of the central excise act 1944 and failed to discharge the duty liability as specified by the commissioner of central excise aurangabad under rule 96zp(3)/96zo of central excise rules, 1944. it appears that all the manufacturers of m.s. bars and ingots have challenged the notification fixing the duty liability under the acp before the supreme court. ultimately, the supreme court of india, upheld the validity of the notification in favour of the department.the deputy commissioner, central excise & customs has disposed off the cases on different assesses including the appellant by a common order-in-original, wherein the penalty amount and interest were confirmed as proposed under rule 96zp(3) of the central excise rules.the appellant has preferred the appeal before the commissioner (appeals), aurangabad, who in turn has confirmed the same. hence the present appeal. i) the duty amount can be paid even before the issuance of the show cause notice and as such no penalties leviable including the interest amount, as per the decisions in the case of cce, delhi-iii, gurgaon v. machino montell (i) ltd. and ors. connected decisions in this regard. therefore, he urge to set aside the penalty amount and also interest levied on the duty liability.4. ld. dr contends that the judgments in the case of machino montell (i) ltd., is under section 11ac of central excise act, 1944, whereas in the instant case, penalties are to be levied under rule 96zp(3)/173q of central excise rules, which is a specific provision. as such, the decision of machino montell (i) ltd., will not work out. further, he relied upon the following decisions:pee aar steels (p) ltd., v. commissioner of central excise, meerut cc & ce, indore v. s.p. tobacco pvt ltd., & naveen jhanjee, md reported in 2005 (98) ecc 707 (tri.) 5. ld. counsel for the appellants in his reply arguments relied upon the decision in the case of mitra steel & alloys pvt ltd. v. cce, raigad, vide.....

Full Judgment

2. The appellants M/s. Shradha Steels is a manufacturer of M.S. Bar falling under Chapter Sub Heading No. 7214.90 and MS ingots falling under Chapter Sub Heading 7206.90 of the Central Excise Tariff Act, 1985. Show cause notice was issued to the appellants proposing to levy of penalty and interest amount as the appellants failed to deposit the duty amount within the scheduled time fixed on the basis of annual capacity of production. On due adjudication of the matter, it is found that the appellant was working under compounded levy scheme as per the Section 3A of the Central Excise Act 1944 and failed to discharge the duty liability as specified by the Commissioner of Central Excise Aurangabad under Rule 96ZP(3)/96ZO of Central Excise Rules, 1944. It appears that all the manufacturers of M.S. Bars and Ingots have challenged the Notification fixing the duty liability under the ACP before the Supreme Court. Ultimately, the Supreme Court of India, upheld the validity of the Notification in favour of the department.

The Deputy Commissioner, Central Excise & Customs has disposed off the cases on different assesses including the appellant by a common order-in-original, wherein the penalty amount and interest were confirmed as proposed under Rule 96ZP(3) of the Central Excise Rules.

The appellant has preferred the appeal before the Commissioner (Appeals), Aurangabad, who in turn has confirmed the same. Hence the present appeal.

i) The duty amount can be paid even before the issuance of the show cause notice and as such no penalties leviable including the interest amount, as per the decisions in the case of CCE, Delhi-III, Gurgaon v. Machino Montell (I) Ltd. and Ors. connected decisions in this regard. Therefore, he urge to set aside the penalty amount and also interest levied on the duty liability.

4. Ld. DR contends that the judgments in the case of Machino Montell (I) Ltd., is under Section 11AC of Central Excise Act, 1944, whereas in the instant case, penalties are to be levied under Rule 96ZP(3)/173Q of Central Excise Rules, which is a specific provision. As such, the decision of Machino Montell (I) Ltd., will not work out. Further, he relied upon the following decisions:Pee Aar Steels (P) Ltd., v. Commissioner of Central Excise, Meerut CC & CE, Indore v. S.P. Tobacco Pvt Ltd., & Naveen Jhanjee, MD reported in 2005 (98) ECC 707 (Tri.) 5. Ld. Counsel for the appellants in his reply arguments relied upon the decision in the case of Mitra Steel & Alloys Pvt Ltd. v. CCE, Raigad, vide order No. 521-522/WZB/2005/C-II dated 12/08/2005, wherein the Rule 96ZO(3) was held to be ultra-virus and the same has been struck down. Consequently, the amounts determined in the appeals under consideration of that case were not upheld. It is his further contention, similarly Rule 96ZP(3) which was framed under Section 3A was deleted on 11/05/2001 and the adjudication in this case took place subsequently i.e. on 22/03/2004.

6. The contention raised by the Ld. DR is answered in the judgment of the Tribunal in the case of Mitra Steel & Alloys Pvt Ltd., and as well as the Rule 96ZP was deleted in the year 2001 itself. Therefore, I am of the view that while following the case of Machino Montell (I) Ltd., and Mitra Steel & Alloyes Pvt Ltd., no penalty is imposable and also as well as interest amount leviable when the duty amount has been paid before the issuance of the show cause notice. Applying the above decision, the impugned order confirming the penalties and as well as the interest is hereby set aside. In he result, the appeal is allowed.

Same Court & Year Customs Excise and Service Tax Appellate Tribunal CESTAT Mumb... Same Parties Shradha Steels vs The Commissioner of Central Same Subject Excise Same Judge T Anjaneyulu