M/S. J.K. Forgings Vs. Cce, New Delhi - Court Judgment

Excerpt:
1. this application is for waiver of penalty amount of rs. 40,000/- and for stay of recovery thereof. on the basis of shortage of raw materials found by officers of the central excise department, who visited the applicant's factory, the department by show-cause notice proposed to recover an amount of rs. 81,210/- towards duty of excise on the raw materials found short and also to impose penalty on the applicants. the party contested the notice. the assistant commissioner, who adjudicated the dispute, confirmed the demand against the party and imposed on them a penalty of rs. 80,000/-. in the appeal filed against the assistant commissioner's order to the commissioner (appeals), the latter reduced the penalty to rs. 40,000/- and upheld the order of the adjudicating authority on other counts. hence the appeal before the tribunal.2. heard ld. advocate, sh. m.l. gupta for the applicants and ld. dr sh.j. singh for the respondents.3. on examination of records and the submissions made by both sides today, i find that the entire amount of duty confirmed by the lower authorities had been paid by the applicants well before the issuance of the show-cause notice. therefore, the only question surviving in the present application is as to whether a penalty of rs. 40,000/- was liable to be imposed on the party under rule 173q of the central excise rules in the facts and circumstances of the case. since the entire amount of duty was paid by the party well before the issuance of the show-cause notice, there is a strong prima facie case in this application for complete waiver of pre-deposit of the penalty amount.accordingly, the application is allowed unconditionally. there will be waiver of predeposit of the penalty amount and stay of recovery thereof, pending the appeal. the pending the appeal. the appeal will arise for regular hearing in due course.

Judgment:
1. This application is for waiver of penalty amount of Rs. 40,000/- and for stay of recovery thereof. On the basis of shortage of raw materials found by officers of the Central Excise department, who visited the applicant's factory, the department by show-cause notice proposed to recover an amount of Rs. 81,210/- towards duty of excise on the raw materials found short and also to impose penalty on the applicants. The party contested the notice. The Assistant Commissioner, who adjudicated the dispute, confirmed the demand against the party and imposed on them a penalty of Rs. 80,000/-. In the appeal filed against the Assistant Commissioner's order to the Commissioner (Appeals), the latter reduced the penalty to Rs. 40,000/- and upheld the order of the adjudicating authority on other counts. Hence the appeal before the Tribunal.

2. Heard ld. advocate, Sh. M.L. Gupta for the applicants and ld. DR Sh.

J. Singh for the respondents.

3. On examination of records and the submissions made by both sides today, I find that the entire amount of duty confirmed by the lower authorities had been paid by the applicants well before the issuance of the show-cause notice. Therefore, the only question surviving in the present application is as to whether a penalty of Rs. 40,000/- was liable to be imposed on the party under Rule 173Q of the Central Excise Rules in the facts and circumstances of the case. Since the entire amount of duty was paid by the party well before the issuance of the show-cause notice, there is a strong prima facie case in this application for complete waiver of pre-deposit of the penalty amount.

Accordingly, the application is allowed unconditionally. There will be waiver of predeposit of the penalty amount and stay of recovery thereof, pending the appeal. The pending the appeal. The appeal will arise for regular hearing in due course.