2009 (8) TMI 864 - AT - Central Excise

Tribunal Upholds Penalty for Duty Delay under Central Excise Rules

The Tribunal upheld the penalty imposed for delay in payment of duty under Rule 96-ZQ(5)(ii) of the Central Excise Rules, 1944. The appellant's challenge ... Penalty - Delay in payment of duty by few days Issues Involved:1. Challenge to the penalty imposed for delay in payment of duty u/s Rule 96-ZQ(5)(ii) of the Central Excise Rules, 1944.2. Request for adjournment to seek review of the High Court order.3. Discretionary power of authorities in imposing penalties.Summary:1. Challenge to the Penalty Imposed:The appeal arises from the order dated 5-8-2003 by the Commissioner (Appeals), Jaipur, following a remand by the High Court of Rajasthan. The appellant challenged the penalty imposed for delay in payment of duty u/s Rule 96-ZQ(5)(ii) of the Central Excise Rules, 1944. The Tribunal noted that the delay in payment was acknowledged and detailed in the show cause notice, with specific instances of delayed payments and corresponding interest recoverable.2. Request for Adjournment:The appellant sought adjournment to move the High Court for a review of its order dated 2nd April, 2008, citing an error in the case law presented. The Tribunal rejected this request, stating that the decision of the Rajasthan High Court was based on multiple grounds, including a Supreme Court ruling, and thus the request was devoid of substance.3. Discretionary Power in Imposing Penalties:The appellant argued that the authorities should have discretion in imposing penalties, especially considering the short delay and financial difficulties. However, the Tribunal, referencing the Supreme Court decision in Union of India v. Dharamendra Textile Processors, held that the authorities have no discretionary power and must impose the mandatory penalty as per the statute. The Tribunal emphasized that the statute mandates a penalty equal to the amount of duty outstanding, leaving no room for reduction based on financial constraints or short delays.Conclusion:The Tribunal concluded that the statutory provisions leave no discretion to alter the penalty amount, which must be equal to the duty outstanding. Consequently, the appeal was rejected, upholding the penalty imposed.