TaxTMI 
TaxTMI 
2010 (9) TMI 612
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....d order to be illegal, arbitrary, perverse, baseless, without fair and objective application of mind, violative of natural justice, without jurisdiction, barred by limitation, without following the binding precedence and mandatory provisions of the statute and, thus the demand made on the basis of such order to be illegal. 4. Having heard at length the learned advocate for the appellants and on perusal of the show cause notice, reply thereto, the written submissions filed by the appellants before the Commissioner (Appeals) on 24th August, 2009, the impugned order, the memorandum of appeal and the affidavit filed by the appellants, it is apparent that the only point which appears to be omitted to have been considered in detail is with reference to the decision of the Punjab & Haryana High Court in the case of Commissioner of Central Excise, Panchkula v. Polyplastics, reported in 2009 (236) E.L.T. 210 (P & H). All other points are clearly considered by the Commissioner (Appeals) in the impugned order. There may not be elaborate discussion about the same. Whether the reasoning and the conclusions are correct or not is a totally different issue. However, it cannot be said that ....
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....ty paid on the supplementary invoices which were issued on account of price escalation. Indeed, as rightly held by the lower authorities, the issue in this aspect is well settled by the decision of the Apex Court in SKF India Ltd.'s case (supra). The said decision of the Apex Court is with reference to Section 11AB of the Central Excise Act, 1944 which reads thus : 11AB. Interest on delayed payment of duty. - [(1) Where any duty of excise has not been levied or paid or has been short-levied or short-paid or erroneously refunded, the person who is liable to pay duty as determined under sub-section (2), or has paid the duty under sub-section 2(B), of Section 11A, shall, in addition to the duty, be liable to pay interest at such rate not below [ten per cent] and not exceeding thirty-six per cent. Per annum, as is for the time being fixed by the Central Government, by notification in the Official Gazette, from the first date of the month succeeding the month in which the duty ought to have been paid under this Act, or from the date of such erroneous refund, as the case may be, but for the provisions contained in sub-section (2), or sub-section (2B), of Section 11A till the date....
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.... scheme of that section in a more coherent and readable form. 8. Be that as it may. In the case in hand we have to deal with the law as it stands now. 9. Section 11A puts the cases of non-levy or short levy, non-payment or short payment or erroneous refund of duty in two categories. One in which the non-payment or short payment etc. of duty is for a reason other than deceit; the default is due to oversight or some mistake and it is not intentional. The second in which the non-payment or short payment etc. of duty is "by reason of fraud, collusion or any wilful mis-statement or suppression of facts, or contravention of any of the provisions of the Act or of Rules made thereunder with intent to evade payment of duty"; that is to say, it is intentional, deliberate and/or by deceitful means. Naturally, the cases failing in the two groups lead to different consequences and are dealt with differently. Section 11A, however allow the assessees in default in both kinds of cases to make amends, subject of course to certain terms and conditions. The cases where the non-payment or short payment etc. of duty is by reason of fraud collusion etc. are dealt with under sub-section (1A) of Sec....
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....y and Section 11AA is also on the subject of interest on the delayed payment of duty and considering the same how these provisions are to be read and to be understood has been elaborately explained by the Apex Court in SKF India Ltd.'s case (supra). 9. In the matter in hand, the demand of interest is to the tune of Rs. 6,45,723/- relates to the year 2006-07 and sum of Rs. 12,898/- relates to the year 2007-08. The show cause notice was issued on 4th March, 2008. 10. Considering the above facts and in view of the decision in SKF India Ltd.'s case (supra), it is sought to be contended on behalf of the appellants that the appellants were unaware of the said decision even on the date when the written submissions were filed. However, considering the fact that the said decision, the liability of the appellants to pay the interest in relation to the year 2007-08 cannot be disputed as the demand was within time. The learned advocate for the appellants, however, has contended that the demand for the earlier year i.e. for the year 2006-07 is barred by limitation as the show cause notice was issued beyond the period of one year i.e. on 4th March, 2008. 11. As far as the....
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....ot inform the Department regarding non-payment of interest with the sole intent to evade payment of interest on differential duty thereby rendering the extended period under Section 11A invokable. Section 11A deals with the mechanism of recovery of duties not levied or not paid or short levied or short paid or erroneously refunded. It does not provide for invoking of extended period if there is intent to evade payment of interest on differential duty. The noticee paid differential duty by raising the supplementary invoices. The serial numbers of the invoices issued in a month were reflected in the return as required. No other obligation in this regard was required to be discharged by the noticee. It is a settled legal position that there cannot be any suppression of fact if an information, which is not required to be given under the law, is not given by an assessee." 14. In reply itself, attention was sought to be drawn to the decision of the Gujarat High Court in Prolite Engineering Co.'s case (supra) and of the Larger Bench of the Tribunal in Ramply (India) Ltd.'s case (supra) in this regard. 15. At the outset, it is to be noted that the notice dated 4th March,....
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....ent of duty for whatever reason it might have been delayed and it includes deferred payment. Even though the assessee had to pay the duty subsequent to the issuance of the supplementary invoice on account of price escalation, the obligation of the assessee to pay the duty relates back to the date of issuance of the original invoice i.e. the date on which the goods were cleared. The law in this regard being very clear, any attempt on the part of the assessee to avoid the payment of interest even on the deferred payment of duty as a result of issuance of supplementary invoice on account of price escalation would amount to evasion of payment of interest which, obviously, empower the Department to invoke the extended period of limitation in cases where such evasion was not within the knowledge of the Department within the period of limitation prescribed under the law. 18. It is to be noted that, it is not the case of the assessee that it was within the knowledge of the Department within the period of limitation that the assessee did not pay interest on the differential duty. The contention is that, there was no obligation to inform the said fact to the Department. It is rather ....
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....thing to do with the issue of penalty as rightly pointed out by the learned advocate for the appellants. In view of non-imposition of penalty by the authorities below, question of consideration of the issue of penalty does not arise. 20. As already pointed out above, once records clearly disclose that the appellants knowing well about his liability to pay the differential duty on account of issuance of the supplementary invoices, as a result of price escalation, had, in fact, paid such differential duty, it was but obvious that the appellants were also required to clear said obligations in relation to such differential duty as provided under the statutory provisions and in case the appellants wanted to avoid such obligation being performed, it was necessary for the assessee to claim the same in accordance with the provisions of law and for that purpose to intimate the same to the Department. Evidently, in this regard, on account of failure on the part of the assessee to take appropriate steps, the Department was kept in dark about non-payment of such interest on the differential duty by the appellants. The fact that the Department was not aware about the same is nowhere dis....