Discretion in forfeiture of fortnightly duty payment facility upheld where prior denial already covered the default period.

Rule 8(4) of the Central Excise (No. 2) Rules, 2001 does not require forfeiture of the facility of fortnightly duty payment for the maximum period in every case. The appellate authority may restrict the forfeiture period on the facts, including prior denial already suffered by the assessee, where that discretion is properly exercised and supported by earlier Tribunal reasoning. On the stated facts, the further denial of the facility was limited because a six-month deprivation had already been imposed, and the restriction was upheld. The Revenue's challenge to that discretionary limitation did not succeed.

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Issues: Whether, under Rule 8(4) of the Central Excise (No. 2) Rules, 2001, forfeiture of the facility of fortnightly payment of duty had to be imposed for the maximum period in every case, and whether the appellate authority was justified in restricting the forfeiture period on the facts of the case.

Analysis: The appeal challenged the appellate authority's view that a further denial of the facility for two months was not fair when the assessee had already suffered denial for six months under earlier orders. The reasoning accepted that Rule 8(4) did not make the maximum period of forfeiture compulsory in all situations. On the facts, the appellate authority had exercised discretion after considering the prior period during which the facility had already been denied, and there was no specific challenge to that finding or to the reliance placed on the earlier Tribunal decision supporting such discretion.

Conclusion: The restriction of the forfeiture period was upheld, and the Revenue's challenge failed.

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