2010 (7) TMI 385

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.... provisions of Rule 8 of the Central Excise Rules, 2002. During the period from April 2007 to October 2007, the appellant defaulted in payment of excise duty on due date for more than 30 days and thus, violated the provisions of Rule 8 of Central Excise Rules. In terms of sub Rule 3A of Rule 8, if an assessee default in payment of duty beyond 30 days from the due date, as provided in sub Rule-1, the assessee is required to pay duty for the subsequent consignments at the time of removal, without utilizing cenvat credit. The said Rule also provide that in the event of any failure, it shall be deemed that such goods have been cleared without payment of duty and such consequences and penalties as provided in this Rule, shall follow. 2.&#8195....

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....ribunal. 4. I have heard both the sides duly represented by Shri P.M. Dave, advocate for the appellants and Shri S.K. Mall, SDR for the Revenue. 5. Tribunal in the case of Saurashtra Cement Limited v. CCE, Rajkot - 2008 (225) E.L.T. 395 (Tri. Ahmd.) has considered an identical issue. It stands observed by the Tribunal in Para 5 that penalty for such an offence has to be imposed under Rule 27 and not under Rule 25. As the said Rule 25 provides maximum penalty of Rs. 5,000/-, the penalty was reduced to Rs. 5,000/- in that case. For better appreciation, Para 5 and 6 stands reproduced :- "5. We find that Rule 25 of Central Excise Rules, 2002 provides for imposition of penalties which shall not exceed the duty on the e....

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.... M/s. Automotive India (Raipur) Pvt. Ltd. [2006 (203) E.L.T. 402 (Tri. -Del.)] and CCE, Allahabad v. R.K. Cigarettes (P) Ltd. [2007 (213) E.L.T. 367 (Tribunal) = 2007 (79) RLT 804 (CESTAT - Del.)]. It has been held in the said decisions of the Tribunal that delay in payment of duty due to financial crisis will not attract penalty under the provisions of Rule 25 of Central Excise Rules, but the said contravention would attract penal provisions of Rule 27, which provides maximum penalty of Rs. 5000/-. As the said rules prescribes maximum penalty of Rs. 5000/-. We accordingly reduce the penalties in each case to Rs. 5000/-. The said decision in the case of Shaurashtra Cement Limited subsequently followed by the Shaligram Laminates Pvt. Limi....

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....ns of Rule 8, as contained in Rule 8A, the failure on the part of the assessee to pay duty on consignment basis from PLA shall be deemed as if such goods have been cleared without payment of duty and the consequences and penalties as provided in these Rules shall follow. One thing become clear from the above that consequence of such failure on the part of the assessee would meet with the penal provisions as contained in the Rules. I would like to observe here that an identical provision was available in Rule 8, in the shape of sub-Rule 4 providing the same consequence and penalties in terms of the Rules, which already stands considered by the Tribunal in the case of Saurashtra Cement Limited. I would also like to mention here that the penal....