2002 (10) TMI 543 - AT - Central Excise

Tribunal Allows Delay in Appeal Filing, Challenges Stay Application on Duty Recovery

The Tribunal condoned the 2-day delay in filing the appeal against the Commissioner (Appeals) order due to its short duration. The stay application under ... Appeal to Appellate Tribunal - Limitation - Stay/Dispensation of pre-deposit Issues:1. Condonation of delay in filing appeal.2. Stay application under Section 35F of the Central Excise Act for duty and penalty amounts.3. Allegations beyond the scope of show cause notice.4. Discrepancy in decision grounds between show cause notice and authorities.5. Contravention of Rule 173H regarding goods dimensions.6. Imposition of penalty exceeding prescribed limit.Analysis:1. The judgment addresses the issue of condonation of delay in filing the appeal against the order passed by the Commissioner (Appeals). The appellants claimed to have received the order on 22-2-2002 and filed the appeal on 23-5-2002, resulting in a delay of 2 days. The Tribunal, after considering the explanation and hearing both sides, condoned the delay due to its short duration.2. The stay application under Section 35F of the Central Excise Act sought to stay recovery of duty and penalty amounts. The case involved the clearance of goods without payment of duty, claiming exemption under Rule 173H due to defects in the goods returned by customers. The Department proposed duty recovery and penalties for contravention of Central Excise Rules, which were confirmed by the Adjudicating Authority and the first Appellate Authority. The appeal challenged these decisions.3. The issue of allegations beyond the scope of the show cause notice was raised by the appellants, contending that the authorities decided the matter on grounds different from those in the notice. The Counsel argued a strong prima facie case, emphasizing discrepancies in the decision-making process.4. The judgment highlighted a discrepancy in the decision grounds between the show cause notice and the authorities. The show cause notice focused on the permission under Rule 173H and the category of goods, while the authorities based their decision on the dimensions of the goods, which was not explicitly alleged in the notice.5. The contravention of Rule 173H regarding goods dimensions was a crucial aspect of the case. The authorities found that the goods cleared without duty payment were thicker than the defective goods received, indicating a violation of the rule. However, the penalty imposed exceeded the prescribed limit, raising concerns about the penalty imposition process.6. In conclusion, the Tribunal directed the applicants to deposit a specified amount towards penalties within a given timeframe, considering the established contravention of Rule 173H. The judgment emphasized the discrepancy between the allegations in the show cause notice and the basis of the authorities' decision, leading to a detailed analysis of the case's various legal aspects.