2016 (4) TMI 321 - AT - Central Excise

Tribunal reinstates duty liability and penalty for clandestine goods removal, emphasizing party stance consistency.

Commissioner of Central Excise, Guwahati Versus M/s. Excellent Gravure Industries (P) Ltd.

Commissioner of Central Excise, Guwahati Versus M/s. Excellent Gravure Industries (P) Ltd. - TMI Issues: Appeal against Order-in-Appeal setting aside duty confirmed on clandestine removal of goods and equivalent penalty, refund of amount paid by Respondent, interpretation of acceptance of duty liability, applicability of interest under section 11BB of the Central Excise Act, 1944.Analysis:1. The appeal was filed by the Revenue challenging the Order-in-Appeal dated 22.02.2013, which set aside the duty confirmed on clandestine removal of goods and the equivalent penalty imposed under section 11 AC of the Central Excise Act, 1944. The First Appellate Authority directed the department to refund the amount of Rs. 1,82,971/- paid by the Respondent along with interest under section 11BB of the Central Excise Act, 1944. The Revenue argued that the Respondent had earlier accepted duty liability on clandestine removal of goods and cannot take a different stand later, citing the case law Tractors and Farm Equipment Limited vs. Collector of Customs, Madras [1997(91) E.L.T.254(S.C)].2. During the hearing, no one appeared on behalf of the Respondent. The case records showed a similar absence on a previous occasion as well. The Adjudicating Authority had observed that 6078.460 kgs of Laminated Film were cleared without payment of duty, and the Respondent accepted the duty liability and paid the amount. A refund claim filed by the Respondent under notification No.32/99-CE was rejected by the Adjudicating Authority. The First Appellate Authority set aside the Order-in-Original and ordered the refund amount to be paid along with interest under section 11BB of the Central Excise Act, 1944. The Revenue contended that no interest of deposit is payable under 11BB as the interest on deposits was introduced in the statute books in 2014.3. The department detected that the Respondent had short-paid Rs. 1,50,199/- due to clandestine removal of finished goods, which was admitted and paid in August 2009. The same amount was included in a total refund filed by the Respondent under Notification No.32/99-CE. The Adjudicating Authority rejected the amount, and no appeal was filed by the Respondent. The Tribunal held that the Respondent's acceptance of the duty liability precluded them from denying clandestine removal later. The Appeal was allowed, setting aside the Order-in-Appeal and restoring the Order-in-Original.In conclusion, the Tribunal allowed the Revenue's appeal, emphasizing the principle that a party cannot alter its stance on an issue once accepted. The judgment reinstated the duty liability and penalty imposed on the Respondent for clandestine removal of goods, overturning the Order-in-Appeal that directed a refund with interest.