Tribunal overturns penalty for late filing, citing transition to GST & absence of saving clause.

The Tribunal set aside the penalty imposed under Rule 12(6) of the Central Excise Rules for late filing of Returns (ER-1) for the period July 2017 to February 2018. The judgment emphasized the appellant's transition to GST provisions post-repeal of the Central Excise Act, noting the absence of a saving clause in the CGST Act for penalties under the old regime. The Tribunal deemed the penalty unjustified, ruling in favor of the appellant and granting consequential benefits.

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Issues: Imposition of penalty under Rule 12 (6) of Central Excise Rules for late filing of Returns (ER-1) for the period July 2017 to February 2018.

Analysis:
The judgment pertains to the imposition of a penalty under Rule 12 (6) of the Central Excise Rules for late filing of Returns (ER-1) for the period July 2017 to February 2018. The appellant argued that the Central Excise Act and related Rules were repealed with the implementation of the GST regime from July 1, 2017. The appellant had transitioned to filing returns under the GST provisions and believed they were no longer required to file returns under the erstwhile Central Excise Act. The appellant had filed returns up to June 30, 2017, under the repealed Act. However, the Commissioner (Appeals) did not address this contention in their findings. The judgment highlighted that the lower court had based its decision on Section 174 of the CGST Act, which deals with repeal and savings but lacks a saving clause for imposing penalties for non-filing of returns once GST provisions are in place. The Tribunal found the show cause notice to be misconceived and the impugned order to be erroneous in law. Consequently, the Tribunal held that the penalty imposed for non-filing of returns for the period in question was unjustified and set aside the impugned order, allowing the appeal and granting the appellant consequential benefits.

In conclusion, the Tribunal allowed the appeal, set aside the impugned order imposing a penalty under Rule 12 (6) of the Central Excise Rules for late filing of Returns (ER-1) for the period July 2017 to February 2018. The judgment emphasized the appellant's transition to filing returns under the GST provisions post the repeal of the Central Excise Act and Rules, highlighting the lack of a saving clause in Section 174 of the CGST Act for imposing penalties under the erstwhile regime. The Tribunal deemed the penalty imposition as unwarranted and ruled in favor of the appellant, granting them consequential benefits.

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