Mahavir Steel Industries Ltd vs Commissioner Of Central Excise, ...

(Arising out of Order-in-Appeal No. PIII/226/04 dated 8.12.2004 passed by Commissioner of Central Excise (Appeals), Pune-III)

For approval and signature:

Honble Mr. P.K. Jain, Member (Technical) and Honble Mr. Ramesh Nair, Member (Judicial)

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1. Whether Press Reporters may be allowed to see : No the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?

2. Whether it should be released under Rule 27 of the :

CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3. Whether Their Lordships wish to see the fair copy : Seen of the Order?

4. Whether Order is to be circulated to the Departmental : Yes authorities?

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Mahavir Steel Industries Ltd. Appellant Vs. Commissioner of Central Excise, Pune-III Respondent

Appearance: Shri Narayan Ulhalkar, Excise Officer, for appellant Shri N.N. Prabhudesai, Superintendent (AR), for respondent

CORAM: Honble Mr. P.K. Jain, Member (Technical) Honble Mr. Ramesh Nair, Member (Judicial)

Date of Hearing: 11.3.2015 Date of Decision: 11.3.2015

ORDER NO Per: P.K. Jain

Brief facts of the case are that the appellant was manufacturing goods and paying duty on monthly basis. During the month of January 2003, the appellant forgot to include one invoice in the daily stock account and paid the monthly duty without accounting the same. Later on, they realized from the system software that the said invoice has been left out while paying the duty. Similar mistake happened during the months of April, May and July. On realizing the mistake, the appellant suo motu paid the differential duty on 20.8.2003 along with interest @ 2% p.m. Range Superintendent took the view that this is a case of default in payment of duty and as per the then Rule 8 of the Central Excise Rules, 2002, the appellant was to pay interest @ Rs.1,000/- per day. Initially, the appellant resisted the same, however, paid the same before the issue of the order-in-original.

2. Shri Narayan Ulhalkar, Excise Officer, appeared during the hearing and gave the written submissions and reiterated the points made in the same. In the written submissions, appellant is asking for setting aside penalty.

3. Learned AR reiterates the findings in the impugned order and states that the Commissioner (Appeals) has already reduced the penalty from Rs.1,60,664/- to Rs.80,000/-. He further submitted that the appellant was not maintaining the daily stock account register properly and in which they were required to make entries on day-to-day basis. Further, the ER-1s did not reflect the correct position and in view of these, the penalty imposed is not on higher side.

4. We have gone through the written submissions and we find that the appellant is not disputing the duty liability as also the interest already paid by them. They are only requesting for non-imposition of penalty. We observe that in this case, the appellant was paying the duty on monthly basis and the payments were made regularly. It is only during these months due to some discrepancies between their system software and daily stock register that certain invoices were left out and they did not pay the duty on the same. However, the mistake was realized by themselves and on their own, they paid the duty along with interest @ 2%. The department insisted that this is a case of default in payment of duty and they are required to pay interest @ Rs.1,000/- per day. Even though the appellant resisted this interpretation, however, they have paid the interest accordingly before the issuance of the order-in-original. Even though there have been lapses on the part of the appellant, however, keeping in view the overall conduct of the appellant, we feel this is not a case for imposition of penalty and accordingly the penalty is set aside. As far as duty and interest are concerned, the same are not being disputed. Hence the same are not being examined by this Tribunal.

5. The appeal is allowed in above terms.

(Operative part pronounced in Court)

(Ramesh Nair) Member (Judicial) (P.K. Jain) Member (Technical)

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