2011 (6) TMI 640

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... so. Neither did they pay it with interest, within 30 days from the due date as provided in Rule 8(3A) of the Central Excise Rules, 2002. 2. In such circumstances Rule 8(3A) of the Central Excise Rules enjoins certain penal consequences. For the sake of convenience this sub-rule is re-produced below. (3A) If the assessee defaults in payment of duty beyond thirty days from the due date, as prescribed in sub-rule (1), then notwithstanding anything contained in said sub-rule (1) and sub-rule (4) of Rule 3 of CENVAT Credit Rules, 2004, the assessee shall, pay excise duty for each consignment at the time of removal, without utilizing the CENVAT credit till the date the assessee pays the outstanding amount including interest there....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....er the Appellant has filed this appeal before the Tribunal. 7. The Appellants submits the following : (i)      They are willing to pay duty in PLA provided the amount paid using Cenvat Credit during the defaulting period is allowed to be re-credited in their Cenvat Account. (ii)    They are willing to pay interest on duty payable on the clearances made during the defaulting period till the date on which they paid all the defaulted amount. (iii)   The question whether penalty under Rule 25 could be imposed under such circumstances was examined by the Gujarat High Court in CCE v. Saurashtra Cement Ltd. - 2010 (260) E.L.T. 71 and it was decided that penalty under Rule 27 only c....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... penalties as provided in these rules shall follow". 11. It is relevant to note that what is prescribed is "the consequences and penalties as provided in these Rules" not "consequences and penalties as provided in the Act". Before deciding this issue let us examine what are the consequences of clearances without payment of duty prescribed under the Act and the Rules. These are,- Under the Act (i)      Action under Section 11A for the recovery of the amount and interest payable (ii)    Interest will have to be paid under Section 11AB; (iii)   Penalty will be payable under Section 11AC; (iv)   Goods will be liable to confiscation by virtue of provisions made un....