2026-VIL-528-MAD-CE
  1. Home
  2. 2026-VIL-528-MAD-CE

CENTRAL EXCISE High Court Cases

Central Excise - Penalty for Suppression of facts, Payment of duty component before the issuance of show cause notice. The assessing authority imposed penalty, which was upheld by both the appellate authority and the Tribunal - Applicability of proviso to Section 11AC(1)(a) applies to exempt the assessee from penalty when duty was paid before the show cause notice and interest was paid after the adjudicating authority's order - Whether the penalty imposed on the assessee for wrongly availing CENVAT credit can be considered bad on the ground that the show cause notice did not specify under which limb of Section 11AC of the Central Excise Act 1944 the penalty was being imposed – HELD - The case does not fall within Section 11AC(1)(a) but squarely falls within Section 11AC(1)(c) which pertains to penalty for suppression of facts. Although the show cause notice did not explicitly mention the specific limb of Section 11AC, reading of the entire show cause notice, adjudicating authority's order, appellate authority's order, and the Tribunal's order clearly indicates that the penalty was sought to be imposed on the ground of suppression of facts - The assessee was aware throughout the proceedings that it was facing proceedings for suppression of facts and misrepresentation, as evidenced by its own action of paying the duty component upon being informed of the violation - The reference to Rule 15(2) of CENVAT Credit Rules read with Section 11AC in the SCN makes it evident that penalty was sought for suppression of facts. The fact that only the duty component was paid before the issue of SCN while the interest was paid only after the adjudicating authority's order means that the conditions for the proviso to Section 11AC(1)(a) are not satisfied. The proviso applies only when both duty and interest are paid either before the show cause notice or within thirty days of its issuance. When a case falls within Section 11AC(1)(c), the proviso to Section 11AC(1)(a) does not apply. The applicable provision in such cases is Section 11AC(1)(d), which provides for a reduced penalty of fifteen percent of the duty demanded if the duty and interest are paid within thirty days of the SCN. The assessee cannot take advantage of an incorrect reference to Section 11AC(1)(a) made by the Tribunal and must be judged on the actual content and substance of the order - The imposition of penalty by the assessing authority, as confirmed by the appellate authority and the Tribunal, stands upheld. The appeal is dismissed
Download File
show more Judgements  

Quick Search

/

Advance Search

GST Resources

/

Gst Rate Finder

Weekly Summary

VIL Video

GST Recent Updates: GSTAT, EWB...
By CA Vivek Jalan

Create Account

Security-Code
New Code?

Log In

New User ? Forgot Password ?

Forgot Password

Security-Code
New Code?
Please Note: This facility is only for Subscribing Members.

Email this page

Security-Code
New Code?

Feedback this page

Schedule a Demo

Schedule a demo to know the features and advantages of VILGST portal. Get to know the tips to find the desired results in faster way.

Security-Code
New Code?

Caselaw Request Form (CRF)

Didn’t find what you are searching for? No worries, please give us the following details and VIL will email you the desired Caselaws at the earliest:

Security-Code
New Code?