S.K. Engineering Works vs C.C.E. Delhi-Iv

[Arising out of Order-in-Appeal No.98-101/CE/APPL/D.L.H. IV/2010 dated 06.07.2010 Passed by the Commissioner of Central Excise (Appeals), Faridabad]

For approval and signature:

HONBLE MR. S.K. MOHANTY, MEMBER (JUDICIAL) 1 Whether Press Reporters may be allowed to see 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 of the Order?

4 Whether Order is to be circulated to the Departmental authorities?

S.K. Engineering Works Appellant

Vs.

C.C.E. Delhi-IV  Respondent

Present for the Appellant : Shri.K.L. Handa, Consultant Present for the Respondent: Shri R.K. Mishra,D.R.

Coram: HONBLE MR. S.K. MOHANTY, MEMBER (JUDICIAL)

Date of Hearing/Decision: 10.08.2015

FINAL ORDER NO. __54270/2015_

PER: S.K. MOHANTY

This appeal is directed against the impugned order dated 06.07.2010 passed by the Commissioner of Central Excise (Appeals), Faridabad, upholding the adjudication order. In this case, the benefit of reduced penalty of 25% has not been extended to the appellant, for which the present appeal has been filed before this Tribunal.

2. Shri K.L.Handa, the ld. Consultant appearing for the appellant submits that confirmation of Cenvat demand is not in dispute and the appellant is only contesting the quantum of penalty, which should be confined to 25% of the adjudged Cenvat demand, in terms of Section 11 AC of the Central Excise Act, 1944. The ld. Consultant submits that the entire cenvat demand confirmed in the adjudication order was deposited by the appellant and since the interest liability has not been computed in the adjudication order, the same alongwith penalty has not been deposited and no option for payment of reduced amount of penalty of 25% has been provided by the authorities below. To support his view that the appellant is liable to pay only 25% of penalty, where the entire duty amount has been paid, the ld. Consultant relies upon the judgment of Honble Gujarat High Court in the case of CCE, Surat-II vs. Gopal Fibres Pvt. Ltd., reported in 2010 (256) ELT 10 (Guj.).

3. Per contra, Shri R.K. Mishra, the ld. DR appearing for the Revenue reiterates the findings recorded in the impugned order.

4. I have heard the ld. counsel for both sides and perused the records.

5. I find from the impugned order that the interest liability has not been computed by the Central Excise Department. Further, no option has also been given to the appellant for payment of the reduced amount of penalty within 30 days from the date of issue of impugned order. In this context, I find support from the judgment of Honble Gujarat High Court in the case of Gopal Fibres Pvt. Ltd. (supra), wherein it has been held that the assessee could not be expected to pay interest in absence of its calculation and it was entitled to reduce penalty of 25%, if the same was paid along with duty and interest within 30 days from the option being given to it. In view of the above judgment, I am of the considered opinion that the appellant should be given an option to deposit 25% of reduced penalty. Further, the Department should intimate the exact interest liability, which the appellant is liable to pay.

6. Therefore, after setting aside the impugned order, the matter is remanded to the original authority for computing the interest liability, which should be paid by the appellant along with 25% of penalty. The entire exercise of computation of the interest liability should be completed within a period of 30 days from the date of receipt of this order. If the appellant pays the interest and penalty amount within 30 days from the date of receipt of communication from the Department, it shall be absolved of its liability of paying the amount of penalty confirmed in the present adjudication order.

5. The appeal is disposed of in above terms.

(Dictated and pronounced in the open Court)

(S.K. MOHANTY) MEMBER (JUDICIAL)

Anita

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