Case Law Details
Nexteer Automotive India Pvt Ltd Vs Commissioner of Central Excise and Service Tax (CESTAT Bangalore)
CESTAT Quashes SCN for Lack of Suppression or Misstatement Allegations: Penalty cannot be imposed based solely on audit observations
Introduction: In a significant ruling, the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) Bangalore has quashed Show Cause Notices (SCN) against Nexteer Automotive India Pvt. Ltd. The Tribunal ruled that there were no allegations of suppression or misstatement of facts under Section 11 A(4) of the Central Excise Act (CEA).
What Led to the SCN?: Nexteer Automotive India Pvt. Ltd., a manufacturer of excisable goods, was audited for the period from January to December 2013. During this period, irregular credits were found in their accounts, which were later reversed by Nexteer on January 30, 2014. Despite this, multiple SCNs were issued, citing various amounts of tax involved.
Imposition of Penalty and Subsequent Appeals: Initially, a penalty of 50% of the duty involved was imposed on Nexteer. The company appealed against this decision, and the Commissioner (A) remanded the case to the Original Authority. However, the penalty was reimposed. Another appeal led to the upholding of this penalty by the Commissioner (A) once again.
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