2003 (9) TMI 666 - AT - Central Excise

CESTAT rules against invocation of Section 11A, directs refund in tax appeal

The Appellate Tribunal CESTAT, Bangalore, addressed the issue of condonation of delay and exemption from pre-deposit in this case. The Tribunal found that ... Demand - Limitation - Suppression Issues: Condonation of delay, Exemption from pre-deposit, Justifiability of invoking proviso to Section 11A, Imposition of penalty under Section 11AC, Refund of deposited amountIn this judgment by the Appellate Tribunal CESTAT, Bangalore, the issue of condoning the delay and exemption from pre-deposit was addressed. Both parties agreed to dispose of the appeal despite the delay of 93 days in filing the appeal, and exemption from pre-deposit was granted. The main contention raised by the appellants was against the impugned order passed by the Commissioner, arguing that since the Revenue could not invoke the proviso to Section 11A, the entire demand should have been set aside.Upon reviewing the impugned order, the Tribunal noted that the Commissioner had found the assessee not guilty of suppression, making the invocation of the proviso to Section 11A untenable. Consequently, the Commissioner also concluded that no penalty under Section 11AC could be imposed based on this finding. The appellants contended that if the Commissioner found no suppression, the show cause notice issued outside six months should not have been sustained by invoking the proviso to Section 11A, and the demand of duty should not have been upheld.The Tribunal agreed with the appellants and set aside the impugned order, allowing the appeal. It was further noted that the appellants had deposited Rs. 10,000 towards the demand, and in light of the decision, they were entitled to a refund of this amount. The Tribunal directed the respondent to refund the deposited amount within three months from the date of receipt of the order. The judgment highlights the importance of proper application of legal provisions and the consequences of incorrect invocation of statutory provisions in tax matters.