Case Law Details
Surya Coke Private Limited Vs Commissioner of CGST & CX (CESTAT Kolkata)
Introduction: Surya Coke Private Limited found itself in legal proceedings against the Commissioner of CGST & CX before the CESTAT Kolkata. The complex case revolves around the recovery of arrears of Central Excise Duty, pertaining to the clearance of excisable goods without verifying excise returns during specific periods. After evaluating the scenario, CESTAT Kolkata directed a re-adjudication of the matter.
Analysis:
1. Contravention of Central Excise Rules: The appellant, Surya Coke, allegedly contravened Rule 8(3A) of Central Excise Rules, 2002, by failing to clear excisable goods as per the provisions. They utilized Cenvat credit contrary to regulations, amounting to ₹3,67,53,450.
2. Short Payment of Duty: During the period from 01.05.2011 to 30.09.2014, the appellant reportedly short paid duty amounting to ₹43,85,067, declared in ER-1 returns, and recovery was demanded as per Rule 8(4) of CCR, 2002.
3. Lack of Participation: The Appellant’s absence in hearings and failure to submit replies played a vital role in the proceedings, leading the Commissioner to decide ex-parte.
4. The Verdict of CESTAT Kolkata: The tribunal found it justifiable to remand the case to the adjudicating authority to decide afresh. The re-adjudication would provide another opportunity for the Appellant to present their case.
FULL TEXT OF THE CESTAT KOLKATA ORDER
1. The present appeal filed by the Appellant is against the impugned order dated 30.11/2017 passed by the Commissioner.
2. We observe that the impugned order deals with two issues:
(i) The first issue is that the appellant has contravened the provisions of Rule 8(3A) of Central Excise Rules, 2002,(CER,2002 in short) in as much as they failed to clear excisable goods for home consumption during the period of forfeiture of the facility of monthly duty payment during the period 01.05.2011 to 30.09.2014. During the period they cleared their finished goods on payment of Cental Excise duty by utilizing Cenvat credit amounting to Rs.3,67,53,450/-, contrary to the provisions of Rule 8(3A) of CER,2002. During this period the Appellant was also asked to pay interest on Rs.35,49,757/-of duty paid through PLA, as the duty was not paid on each consignment basis.
(ii) The second issue is that during the period 01.05.2011 to 30.09.2014, they have short paid duty amounting to Rs. 43,85,067/- which they have declared in their ER-1 returns. This amount is to be recovered as arrears as per Rule 8(4) of CCR,2002. Interest is also liable to be paid.
3. We observe that the Appellant has not submitted any reply to the They were asked to submit reply vide letters dated 11.09.2017, 10.10.2017, 02.11.2017 and 07.11.2017 and to appear for personal hearings fixed on 05.10.2017, 26.10.2017, 13.11.2017, and 22.11.2017 respectively. The Appellant neither appeared personally nor sent his authorized representative for the hearings fixed on the above said dates. Accordingly, the Notice was decided ex-parte by the Commissioner.
4. From the impugned order, it is found that the Appellant is a manufacturer of excisable goods namely washed coal/ Middling Coal/ Slurry coal/ Crushed coal and cleared the excisable goods without payment of duty during the period April 2013 to January 2015 and did not file ER-1 returns. We also find that the impugned order has demanded short paid duty amounting to Rs.43,85,067/-during the period 01.05.2011 to 30.09.2014, which they have declared in their ER-1 returns. This amount has been proposed to be recovered as arrears as per Rule 8(4) of CCR 2002, in the impugned order. It is not forthcoming from the submissions made by the Appellant, whether this amount of duty has been collected from their customers and retained by them or this duty amount has been collected and paid to the Government account subsequent to filing of returns and declaring the same in the ER-1 returns. Since, the goods were said to have been cleared without payment of duty initially, these details are not available in the records. As the Appellant has not participated in the adjudication proceedings and not attended the personal hearings, there is no findings by the Commissioner on this count in the impugned order. Accordingly, in the interest of justice it is appropriate to remand the matter the adjudicating authority to decide the case afresh, after giving opportunity to the Appellant.
5. Accordingly, the Appeal is disposed of by way of remand to the adjudicating authority to decide the issue afresh. All the issues are kept open for the Appellant to present their case.
(Order pronounced in the open court on 28.07.2023.)
