KRISHNA CAP BOX PVT. LTD Vs. CCE

JUDGEMENT

(1.) THE relevant facts of the case, in brief, are that the appellants are engaged in the manufacture of P.P. Caps classifiable under heading 8309 of the Schedule to the Central Excise Tariff Act, 1985. In the month of December, 2005, they received duty paid defective material in their factory. After intimation to the Superintendent of Central Excise by letter dated 12th December, 2005, they availed the credit under Rule 16 of the Central Excise Rules, 2002. They utilized the amount of Rs. 20,429/ - of cenvat credit on defective material for payment of duty by 5th of the following month in terms of Rule 8 of Central Excise Rules, 2002. In pursuance of the direction of the Assistant Commissioner, the appellants debited the said amount of Rs. 20,430/ - and Education cess of Rs. 409/ - in their current account vide entry No. 18 dated 28.2.06 and deposited the interest of Rs. 452/ - by TR -6 challan dated 4.3.06. By letter dated 6.3.06, they informed the Superintendent of Central Excise of the above facts. On 14.3.06, the appellants received the notice dated 8.2.06 to appear for hearing on 23.3.06 in respect of defaulter in payment of duty for the month of December, 2005. The appellants submitted a letter dated 23.3.06 and appeared for personal hearing. By order dated 4.4.06, the Assistant Commissioner of Central Excise directed the appellant to pay Central Excise duty for each consignment by debiting to the current account only for the period of two months. The Commissioner (Appeals) upheld the adjudication order.

(2.) THE learned Advocate submits that appellants paid the duty in terms of Sub -rule (1) of Rule 8 of Central Excise Rules within 5th day of the following month. Subsequently, the Central Excise officers informed that the amount of Rs. 20,430/ - was utilized from cenvat account is not proper and they have debited the said amount vide entry No. 18 dated 28.2.06. He submits that they have paid the duty within the stipulated period. There is no violation of Rule 8 of Central excise Rules, 2002. He further submits that the Adjudicating Authority had not considered their contention dated 23.3.06.

(3.) AFTER hearing both the sides and on perusal of the record, the appellants paid duty for the month of December, 2005 by 5th of the following month. The learned Advocate submits that they have paid duty for the month of December, 2005 of Rs. 6,37,990.60 whereby the amount of Rs. 20,839/ - was utilized against the returned goods from Cenvat account. The learned Advocate submits that the appellant rightly utilized the amount of Rs. 20,839/ - from Cenvat account. But, they debited the said amount immediately at the instance of Central Excise officers in order to avoid legal complexity. After considering the facts and circumstances of the case, I find that the appellants paid the entire amount of duty of Rs. 6,37,990.60 during the stipulated period as prescribed under Rule 8(1) of Rules and subsequently the amount of Rs. 20,430/ - was alleged irregular which was paid by the appellants voluntarily. In this context, forfeiture facility on monthly payment of duty under Rule 8(3 -A) of the Rules cannot be invoked. It may be mentioned that I have not gone into the question as to whether credit of Rs. 20,839/ - is irregular.