At, Customs Excise Service Tax Appellate Tribunal South Zonal Bench At Chennai
By, THE HONOURABLE DR. CHITTARANJAN SATAPATHY
By, TECHNICAL MEMBER
Shri S. Kandasamy, Consultant. Shri S. Balagopal, Consultant. Shri V.V. Hariharan, JCDR.
1. Heard both sides. These two cases were listed before the Division Bench today but since DB is not sitting and since both the cases fall within the jurisdiction of the Single Member Bench, with the consent of both sides, both the appeals are taken up for hearing and disposal.
2) In Appeal No.786/2004, the appellants cleared the impugned goods during the month of March 2000. They were required to pay the duty amount of Rs.2,57,345/- by 15th of April 2000. The impugned goods were cleared under prescribed invoices etc. and entries were made in the books of account but due to the financial difficulty, duty was not paid. Ld. Advocate for the appellants states that duty along with penal interest of 30% has been paid by the appellants during the period January 2001 to July 2003. The original authority had imposed a penalty of Rs.5000/- on the appellants taking into account the fact that there is no suppression etc. involved in this case and also that the appellants have paid the entire amount of duty and 30% interest thereof. The facts in respect of the appeal No.E/787/2004 also are similar.
3) The department filed appeals before the lower appellate authority on the ground that Rule 173GG required penalty of Rs.500/- per day to be imposed in such cases. The lower appellate authority has correctly decided that the said Rule 173GG was omitted w.e.f. 31.3.2000 and therefore same has no application to cases where the duty liability was to be discharged at a later point of time i.e. on 15.4.2000. However, she has enhanced the penalty of Rs.5000/- imposed in each case by the original authority to Rs.51,000/- and Rs.45,000/- respectively in exercise of the powers vested with the lower appellate authority under Section 35A (3) of the Act.
4) It has been submitted on behalf of the appellants that they have already paid a penal interest of 30% as also penalty of Rs.5000/- each imposed by the original authority. In view of the fact that this was not a case of duty evasion or suppression of facts etc. but merely inability of the appellants to pay the duty in time, the penalty of Rs.5000/- imposed by the original authority should be considered adequate to meet the ends of justice.
5) I find force in the submissions made on behalf of the appellants. In view of the fact that they have already paid penal interest of 30% under the omitted Rule 173GG and the ld. advocate appearing on behalf the appellants states that they have not disputed the duty and interest liability nor they would seek any refund of the interest pa
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id by them, the penalty imposed at the level of original authority is adequate to meet the ends of justice. As such, the impugned order enhancing the penalty passed by the lower appellate authority is set aside and the original authority?s orders are restored. Both the appeals are allowed.