2019 (2) TMI 136 – CESTAT CHENNAI – TMI – Benefit of reduced penalty of 25% u/s 11AC – SSI Exemption in respect of Unit–I – crossing of threshold limit – Held that:- The said request of the appellant is legal and proper for the reason that the adjudicating authority ought to have given the option to pay the reduced penalty of 25% under section 11AC. Thus, the impugned order stands modified to the extent of granting the option to pay reduced penalty of 25% of the duty amount only.
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Demand of duty in respect of Unit–II is ₹ 2,68,455/ period 1997–98 – benefit of SSI exemption – Held that:- The appellant is eligible for the SSI benefit under Notification 38/97. It is also to be noted that the adjudicating authority for the period 1996 – 97 has excluded the value of ₹ 84,585/- and thus the turnover for the year 1996 – 97 which is the preceding financial year would be less than ₹ 300 lakhs. Therefore, the appellant in Unit II would be rightly eligible for notification
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ion No.1/93-CE and clearing goods without payment of duty. During October 1997, the officers visited the premises. On verification of records, it appeared that they had exceeded the SSI exemption limit and were not eligible for SSI exemption for the years 1994 – 95 to 1997 – 98. Show cause notice was issued proposing to demand duty and also for imposing penalties. After due process of law, the original authority confirmed duty demand of ₹ 1,04,641/- for Unit – I and ₹ 2,68,455/- for Unit – II of the appellants and also imposed penalties. In appeal, Commissioner (Appeals) upheld the demand whereas modified the penalties to a limited extent. Aggrieved, the appellants are now before the Tribunal. 4.1 On behalf of the appellant, ld. consultant Shri R. Balagopal appeared and argued the matter. He submitted that in respect of Unit – I, the appellant is not contesting the duty liability and undertakes to pay the same after adjusting the amounts already paid. It is his contention t
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#8377; 12,687/-. Further, if this amount of ₹ 84,585/- is reduced from the turnover of ₹ 3,00,56,769/-, the actual turnover for the year 1996 – 97 would be only ₹ 2,99,72,184/-. Therefore, the turnover for the previous year would be less than ₹ 300 lakhs. Further, in para 12.6 of the adjudication order, the adjudicating authority records that the appellant (Unit – II) was availing SSI exemption and for this reason, it is concluded by the adjudicating authority that the appellants are therefore not eligible to claim the benefit of Notification No.38/1997 for the reason that they have availed MODVAT credit during the period 1997 – 98. This is factually incorrect. The appellant was paying normal rate of duty and also availed MODVAT credit in the year 1997 – 98. Further, Notification 38/97 was introduced on 27.6.1997. The appellant thereupon availed the benefit of SSI exemption as per this notification. Notification 38/97 allowed to pay concessional rate of duty of
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penalty of 25% under section 11AC. Thus, the impugned order in Appeal No. E/1144/2004 stands modified to the extent of granting the option to pay reduced penalty of 25% of the duty amount only. 8. In respect of Unit – II (in appeal No. E/856/2003), the argument of the ld. counsel is that they are not contesting the duty demand for the period 1994 – 95, 1995 – 96 and 1996 – 97. In the show cause notice, the demand of duty in respect of Unit – II is ₹ 2,68,455/- and the same has been confirmed by the authorities below. For the period 1997 – 98, the consultant has rightly pointed out that they have not been availing SSI exemption benefit under Notification 1/93-CE or 16/97-CE. The documents produced (RT 12 returns) for payment of duty from April 1997 to February 1998 shows that the appellants were paying the normal rate of duty at 13% till July 1997. They were also availing MODVAT credit since they were paying the normal rate of duty. Thereafter, when Notification 38/97 was introduc
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