ER-6 RETURN 15-16 AND LATE FILING OF ER-1 14-15

[Asked by Guest]

Sir ,

Kindly guide on following issue

1) our excise audit completed up to dec-15 ,in which Audit party raised demand for late filing of ER-1 for the period 2014-15 and up to dec-15,audit party charge late FILING 100 rs per day ,we have paid as per audit party demand and para has been closed but our Range Supr. demanding us to pay 5000 for each delay ,?

2) WE Have not file ER-6 FOR THE PERIOD 2015-16,IS PENALTY APPLICABLE AS PER 100 PERDAY AND 20000 MAXIMUM WHICHEVER IS HIGHER ,CAN PENALTY BE REDUCED ?

[KASTURI SETHI]

Sh.Vinayak Phrase Ji,

The Range Supdt. is talking about general penalty ofOK ₹ 5000/- under Rule 27 of CE Rules, 2002 which is NOT PER DAY. You have already paid LATE FEE under Rule 12 (6) of CE Rules, 2002. Penalty under Rule 27 is in addition to late fee. There is difference penalty and late fee. ₹ 5000/- is lump sum and one time. It is not per day at all. Normally the department does not impose general penalty when late fee is deposited. General penalty is imposed where no other penalty is provided. It is not intention of the department to put the both the burdens on any assessee. See the difference between penalty and late fee.

Thank u sir

₹ 5000 is applicable for Each Month Delay,We have late filed the return for the Month of April-14.May-14,June-14,Aug-14,Oct-14,Dec-14

[KASTURI SETHI]

Yes. You have got it. Now as per CE law situation is clear. Both are separate. Personally I think such general penalty should not be imposed as interest charged is also "a kind of penal charges" for delay. The issue deserves to be raised before the Board in the RAC meetings by the associations.

Sir,

Pl comment on second issue also Regarding ER-6,Due to some manpower problem we have not filed ER-6 for the year 2015-16, We will have to pay ₹ 240000/- for 12 month as per new rule ,whether it can be reduced ?

[KASTURI SETHI]

Rule 12 (6) of CE Rules, 2002 is applicable here also. It is ₹ 100/- per day and not ₹ 20000/- per month. Maximum does not mean ₹ 20,000/- per month. It is a procedural lapse. The basis of this is your record of inputs, input service etc.. No contravention is there. This is not so serious offence as you have not concealed anything from the department. The whole information is in your books of accounts. This is not too difficult to be tackled.

[gautam vaswani]

Dear Kasturi ji,

need your opinion regarding any fresh CESTAT or any court judgement where department has been asked to take a lenient view on late fees pertaining to late filing of ER1 return.

Brief of the case

Client has not filed ER1 for last 6 months and department has sent a letter to deposit a late fees of INR 78,400/- based on Rule 12 (100 per day and max 20000)

[KASTURI SETHI]

Sir,

There is no relaxation regarding deposit of late fee. No officer has power to relax under Rule 12 (6). It is fixed. Relaxation is possible for general penalty. There is one judgement only on this issue that pertains to the period when returns were filed manually and relaxation was granted because factory was located in a hilly area and far away from range office. Now it is not relevant.

AI Summary

Late-filing penalties separate late fee and general penalty; both may apply to excise returns, limiting relief.
Late filing of excise returns attracts a per-day statutory late filing fee up to a prescribed maximum and a separate lump-sum general penalty. The statutory late fee is mandatory and not subject to officer-level relaxation. The general penalty is one-time, may be imposed in addition to the late fee, but its imposition is discretionary and may be mitigated where the lapse is procedural and records disclose no concealment.