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Ciron Drugs and Pharmaceuticals Pvt. Ltd V/S Commissioner of Central Excise

    Appeal No. E/86104/17 (Arising out of Order-in-Appeal No. SK/39/TH-II/2017, Dated: 10.2.2017 Passed by Commissioner of Central Excise (Appeals), Mumbai) and Order No. A/91726/2017
    Decided On, 28 December 2017
    At, Customs Excise Service Tax Appellate Tribunal West Zonal Bench At Mumbai
    By, THE HONORABLE JUSTICE: RAJU
    By, MEMBER
    For Petitioner: S.S. Gupta, Advocate And For Respondents: H.M. Dixit, Asst. Comm. (A.R.)


Judgment Text

1. This appeal has been filed by M/s.Ciron Drugs & Pharmaceuticals Pvt. Ltd. against demand of interest and imposition of penalty. Ld. Counsel for the appellant argued that the demand of interest and penalty has been made without raising any demand under Section 11A of Central Excise Act. He relied on the decision of the Tribunal in the case of Smita Steel Rolling Mills Pvt. Ltd. Order No. A/86556-86557/16/SMB dated 22/02/2016 -and on the decision of the Tribunal in the case ofEicherDemm : 2002 (140) ELT 227 (Tri-Del), which has been upheld by the Hon'ble High Court as reported in 2010 (2520) ELT 519 (HP).

2. Ld AR relies on the impugned order.

3. I have gone through the rival submissions. I find that the Tribunal in the case of EicherDemm. (supra) has examined this specific issue and come to the following conclusion:

4. In the present case no adjudication proceedings under Section 11A of the Central Excise Act or any other provisions had been conducted at all. A perusal of Section 11AC and 11AB makes it clear that those sections can be invoked only in cases where determination regarding evasion of payment of duty had taken place under Section 11A. In these circumstances, the impugned order passed under Section 11AC and 11AB cannot be sustained. Penalty under Rule 173Q also cannot be imposed without any proceeding on a charge of duty evasion. Accordingly, impugned orders are set aside and appeal is allowed with consequential relief, if any, to the appellant.

The said decision has been upheld by the Hon'ble High Court of Himachal Pradesh at Shimla. In view of the above, no demand of interest and imposition of penalty can be made unless there is a determination of duty under Section 11A of the Central Excise Act. Since in the ins

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tant case, there is no demand of duty and determination under Section 11A of the Central Excise Act. The demand of interest and imposition of penalty cannot sustain. The appeal is consequently allowed.
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