By TIOL News Service

MUMBAI, SEPT 25, 2017: THIS is a Revenue appeal.

The charge is that not only the appellant was a regular defaulter in discharging duty liability while clearing the goods but it has also proved its mischievous conduct by clearing the goods without excisable invoices.

The goods as well as the truck carrying the same were seized.

The adjudicating authority imposed a nominal penalty of Rs.5000/- u/r 27 of the CER, 2002 on the ground that the assessee had discharged the duty with interest.

Revenue is aggrieved and opines that the adjudicating authority without noting the gravity of the matter took a lenient view while imposing penalty. Inasmuch as the ratio of the judgment in Rajasthan Spinning & Weaving Mills - 2009-TIOL-63-SC-CX had been misconstrued while deciding the case.

The respondent submitted that there is no error committed since the original authority had clearly held that neither was rule 25 nor 26 of the CER, 2002 applicable to the case and it was only rule 27 which could be applied to impose penalty of Rs.5000/-.

The Bench inter alia observed -

++ A consistent default in payment of duty by the respondent is noticeable from record. Added to this, it was also attempted to clear the goods without making entry of clearance paying duty in the statutory records. Mere discharging of duty at a subsequent date shall not be consolation to the exchequer that it discharged duty.

++ The delay in discharge of duty is a deprivation to the state to use such revenue for public welfare. Penalty deters violation of law. Authority below should not be sympathetic to relieve the defaulter from violation of law without penalty. When the respondent did not discharge the duty of Rs.1,30,58,434/- duly, but a part of that was discharged on 7.11.2012 at the will and pleasure of respondent after 3 months of the due date and onwards that does not immune the defaulter from penalty. Even the last payment was made nearly after a year of the due date.

++ It may be stated that adjudicating authority without appreciation of law relating to penalty and ingredient of rule 25 made the respondent to avail undue advantage of the judgment of the Hon'ble High Court (in Saurashtra Cement Ltd. – 2010-TIOL-889-HC-AHM-CX) . In the present case, burden of duty has not been willfully discharged by the respondent.

++ It may be appreciated that hardship and loss of benefit to an assessee is not relevant consideration in fiscal jurisprudence as has been held by the Apex Court in the case of Empire Industries ltd. v. Union of India - 2002-TIOL-27-SC-CX .

The matter was remanded to the adjudicating authority.

(See 2017-TIOL-3467-CESTAT-MUM)