Invoice wrong issue

[Guest]

R/sir, Due to system problem we have generate Invoice & despatch FG material without payment of duty ( System not calulate duty ).This problem heighlighted in audit.What imlication for this mistake .please guide . snehal shah

[SANJEEV JADHAV]

Dear Snehal,

Please pay duty, ed. cess and higher sec. ed. cess along with interest 13% on the unpaid duty amount and file the declaration under Sub-section 2 of Section 11A of the Central Excise Act 1944 to your Jurisdictional Excise office. Then no action will be intiated against you for the short duty payment. Please do all above before issue of show cause notice from the department.

[Snehal Kulkarni]

the Only option is to pay the duty along with interest 13%PA before issuance of the SCN.

This will avoid the Penalty.

[CASeetharaman KC]

I agree with my learned friends but what is also important is whether this issue was informed to the department in writing and whther the tax was remitted at the earliest. If this is not done then department can also claim suppression of facts

AI Summary

System Error Causes Duty-Free Dispatch; Pay Duty and Interest, File Under Sec 11A(2) to Avoid Penalties An issue was raised regarding an incorrect invoice due to a system error, leading to the dispatch of goods without duty payment, which was identified during an audit. Respondents advised paying the duty, education cess, and higher secondary education cess with 13% interest on the unpaid amount. It was recommended to file a declaration under Section 11A(2) of the Central Excise Act 1944 before receiving a show cause notice to avoid penalties. Additionally, it was suggested to inform the department in writing and remit the tax promptly to prevent claims of suppression of facts.