Shree Satpuda Tapi Parisar Ssk Ltd vs Commissioner Of Central Excise, Nashik

(Arising out of Order-in-Appeal No. IPL/215/NSK/2008 dated 27.11.2008 passed by Commissioner of Central Excise & Customs (Appeals), Nashik)

For approval and signature:

Honble Mr. P.K. Jain, Member (Technical)

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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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Shree Satpuda Tapi Parisar SSK Ltd. Appellant Vs. Commissioner of Central Excise, Nashik Respondent

Appearance: Shri Pankaj Rathod, Authorised Signatory, for appellant Shri Ashutosh Nath, Assistant Commissioner (AR), for respondent

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

Date of Hearing: 30.1.2015 Date of Decision: 5.2.2015

ORDER NO

Brief facts of the case are that the appellants received molasses and issued the same for manufacturing process. It was found that over a period of years, the amount of molasses issued was less than the amount received. Accordingly a show cause notice was issued to the appellant for recovery of the molasses so short received and for imposition of penalty and recovery of interest. Original authority confirmed the demand along with interest and penalty which were upheld in the impugned order.

2. In the written submissions, the appellant states that they have already reversed the modvat credit involved and are not disputing the same. They are only requesting that the interest and penalty under Section 11AC may not be imposed for the reason that the demand is for the period pertaining to five years and the molasses short found constitutes only .73% and it is well known that molasses gets evaporated and the shortage is because of that and none of the ingredients required for imposition of penalty under Section 11AC are present in the case. It was also submitted that the interest also may kindly be waived.

3. The learned AR reiterates the findings in the impugned order as also the original order and states that evaporation of .73% is very high and cannot be condoned and it is quite possible that the molasses received may be less than what is shown in the invoices.

4. I have considered the submissions. The appellants are not disputing the reversal of the payment of cenvat/modvat credit already made. As far as recovery of interest under Section 11AB is concerned, that is automatic once the duty liability is accepted. As far as penalty under Section 11AC is concerned, I agree with the appellants contention that this is not a case where the material has been diverted and there is any concealment or suppression of facts or contravention of any rules with wilful intent to evade duty. Thus the ingredients of Section 11AC are missing. I therefore set aside the penalty under Section 11AC of the Central Excise Act. The appeal is allowed in above terms.

(Pronounced in Court on 5.2.2015)

(P.K. Jain) Member (Technical)

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