Court sets aside penalties for duty payment via cheques, ruling legal requirements fulfilled

The court set aside the impugned order-in-appeal imposing penalties on the appellants for paying duty through cheques instead of from PLA. The court ruled that the duty payment through cheques, which were not dishonored, fulfilled the legal requirement. As the appellants paid the duty with interest and did not cause revenue loss, the imposition of penalties was deemed unjustified. The appellants' appeals were allowed with any consequential relief permissible under the law.

---

---

Issues involved:
Imposition of penalties for paying duty through cheques instead of from PLA.

Analysis:
The judgment pertains to appeals against a common impugned order-in-appeal concerning the imposition of penalties on the appellants for paying duty through cheques instead of from PLA. The appellants, engaged in the manufacture of aerated water and beverage syrup, paid duty through cheques during the disputed period. The Department did not object to this method of payment, and all cheques were accepted and honored by the Chief Accounts Officer. The delay in encashment of the cheques was attributed to the Chief Accounts Officer's failure to submit them to the bank on time. The appellants had paid interest on the duty amounts at 20%.

In the case of CCE, Jaipur-I v. Genus Overseas Electronics Ltd., the Larger Bench of the Tribunal ruled that the deposit of duty by cheques, which were not dishonored later, fulfilled the legal requirement for duty payment. Since the appellants had paid the duty with interest and did not cause any revenue loss, the imposition of penalties was deemed unjustified. Consequently, the impugned order-in-appeal imposing penalties was set aside, and the appellants' appeals were allowed with any consequential relief permissible under the law.

---