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Corporate News *  Missing seized records must be considered while testing ITC claim; duplicate GST demands ordered corrected: Delhi High Court. *  GST appeal can’t be rejected without addressing taxpayer’s grounds: Allahabad High Court. *  Surplus IGST credit can offset CGST, SGST shortfall: GSTAT. *  GST refund can’t be denied when cancelled airfares are returned with tax: GSTAT. *  3 Hearing notices issued within 2 minutes: Gujarat High Court flags portal flaw, seeks report. *  GSTR-9, GSTR-9C filing for FY 2025-26 enabled; pending GSTR-1 and GSTR-3B must be filed first. *  Dupattas are exempt fabrics, can’t be taxed as fibres at 4%: Madras High Court. *  Full transitional credit allowed on capital goods received after GST rollout: GSTAT denies Rs. 6.99 lakh export duty credit. *  GST return mismatch alone can’t justify fraud proceedings: GSTAT orders fresh adjudication under section 73. *  Supplier found non-existent later can’t alone justify input tax credit denial: GSTAT. *  GST interest stops once tax reaches government account, can’t run until return filing: GSTAT. *  Cancelled flat booking- GST refund can’t be denied without excluding COVID period from limitation: GSTAT. *  India notifies rules of origin for India–New Zealand FTA. *  Incomplete E-bike kits classifiable as complete vehicles, but not eligible for CKD duty concession: CESTAT. *  Same GST rate on main input and output can’t by itself bar inverted duty refund: GSTAT. *  Unjust enrichment doesn’t apply to customs refunds from assessments finalised before July 13, 2006: Gujarat High Court. *  CENVAT credit can’t be denied solely because plant And machinery are embedded in earth: Karnataka High Court. *  DFIA exports ineligible for RoDTEP benefits; customs directs repayment with applicable interest. *  Second E-Way bill alone doesn’t prove another supply: GSTAT. *  Bail denied in Rs. 1.19 crore fake GST refund case over risk of accused absconding again: Punjab and Haryana High Court. *  GST registration can be restored after revocation deadline if outstanding dues are paid: Gauhati High Court. *  Multiple GST proceedings over same suppliers: Calcutta High Court directs dept. to share findings for adjudication. *  E-Governance portal services not OIDAR, fixed deposit interest not taxable: CESTAT. *  Rs. 500 Stamp duty required on authority letters for CAs, CMA and GST practitioners in Pune GST division.  *  Rs. 1.10 crore GST refund must be paid in cash after business closure: Allahabad High Court. *  Godown rent attracts 18% GST even when used exclusively for exempt agricultural warehousing: AAR. *  GST portal launches "Multi-State Registration" facility: one master TRN for registration applications across multiple States/UTs. *  RoDTEP scheme extended till 31st December, 2026.  *  Mere disagreement with order can’t override Rs. 20 lakh appeal limit: GSTAT. *  Customs interest can’t be backdated before confiscation liability is determined; nearly 8 year period excluded: Delhi High Court.
Subject News *  GST summons: anticipatory bail maintainable without arrest order, but relief denied in evasion case: Allahabad High Court. *  GST Appeal can’t be decided without hearing taxpayer’s objections to fresh evidence: Allahabad High Court. *  GST ITC can’t be reversed merely because supplier grants discount without reducing tax liability: GSTAT. *  Mere quoting of GST provision is not a valid charge: GSTAT quashes ITC denial. *  Personal hearing mandatory before adverse GST order, even without taxpayer’s request: Rajasthan High Court. *  Parallel bail pleas without full disclosure amount to abuse of process Rs. 43.08 crore GST case sent for fresh hearing: Supreme Court. *  GST refund based on unchallenged advance ruling can’t be recovered using later circular: GSTAT. *  Payment of GST alone doesn’t end interest and penalty liability when tax and interest remain unpaid beyond 30 days of notice: GSTAT. *  GST demand over builders’ 80% procurement rule requires reasoned adjudication: GSTAT. *  Eligible ITC doesn’t automatically entitle taxpayers to compensation cess refund on domestic sales: GSTAT. *  GST confiscation order passed before reply deadline invalid: GSTAT. *  GST interest can’t be retained after tax refund on delayed export receipts: Punjab & Haryana High Court. *  GST appeal can’t be dismissed over pre-deposit shortfall without opportunity To respond: Bombay High Court. *  DGGI SCN can’t be challenged before reply and adjudication:Chhattisgarh High Court. *  GST input tax credit can’t be denied solely due to supplier’s retrospective registration cancellation: GSTAT. *  GST notice must explain fraud allegations; merely repeating section 74 Is not enough:  Himachal Pradesh High Court. *  Audit detection alone can’t justify GST fraud penalty; specific suppression must be proved: GSTAT. *  GST order uploaded only under ‘Additional Notices’ tab without separate intimation set aside: Calcutta High Court. *  Service Tax appeal can’t be rejected for missing pre-deposit proof when payment is already recorded: CESTAT. *  SGST dept. can’t hear appeal against CGST order: Calcutta High Court. *  Mere dispatch of tax order can’t prove service or make appeal time-barred: CESTAT. *  Dealer incentives can’t be taxed merely on ledger entries: CESTAT. *  DGFT orders quashed for failure to supply DRI letter relied upon in SCN: Bombay High Court. *  GST penalty u/s 122(1A) can’t apply to Pre-2021 transactions; unregistered beneficiaries also covered: Delhi High Court. *  Expired E-way bill caused by wrong PIN code can’t justify GST penalty without intent to evade tax: GSTAT. *  Used railway rails can’t be taxed as track material without proof they are fit for reuse: CESTAT. *  Earlier DGGI notice doesn’t bar separate GST demand on different issue: Delhi High Court. *  ITC dispute involves no question of law: GSTAT directs appeal to Vice-President. *  Earlier DGGI notice doesn’t bar separate GST demand On different issue: Delhi High Court. *  No E-way bill required for interstate goods movement in november 2017: GSTAT quashes detention and penalty.  

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PJ/Case Laws/2012-13/1510

Whether penalty under section 11AC be less than the duty amount ?
Case:- COMMISSIONER OF CENTRAL EXCISE Versus GROWELL AGRI PRODUCTS PVT. LTD.
 
Citation:- 2013 (289) E.L.T. 31 (P & H)
 

Penalty - Quantum of - Reduced by Tribunal after recording finding that shortage of duty paid inputs was on account of pilferage and their becom­ing sub-standard, which did not amount to deliberate mis-statement or con­cealment - HELD : Case did not fall under Section 11AC of Central Excise Act, 1944, which prescribes minimum penalty - In that view, reduction of quantum of penalty upheld.

Brief Facts:-The Department initiated proceedings for levy of duty and vide Or­der-in-original, demand of duty was raised. Apart from duty, penalty was also levied. On appeal, the same was upheld by the Commissioner (Appeals). However, on further appeal, the Tribu­nal reduced the penalty with following observations:-"In this case, the appellants are not challenging the demand of duty in respect of the inputs on which credit has been taken were found short. On verification, the appellant paid duty at the spot when the shortage was pointed out by the Revenue authorities. The explanation given by the ap­pellant that due to pilferage and some inputs become sub-standard which were disposed of without reversing duty as the appellants were well aware of the provisions of Modvat Scheme that the credit is available only in re­spect of the inputs which are used in the manufacture of final product. The appellant cleared some of the inputs without reversing the credit which is admitted by the Chairman cum Managing Director. In these circumstances, I find no infirmity in the impugned order whereby the penalty is imposed. However, taking into the facts and circumstances of the case the penalty is reduced to Rs. 25,000/- otherwise impugned order is upheld. The appeal is disposed of as indicated above."

 

Appellant Contentions:-The Revenue submits that under Section 11AC of the Act, the penalty could not be less than the amount of duty.

 

Respondent Contentions:-The respondent, however, submits that the levy of penalty, in the present case, is not justified under Section 11AC of the Act but could be levied under Rule 173Q of the Central Excise Rules, 1944 under which the penalty is not minimum.

 

Reasoning of Judgment:-We have heard learned counsel for the parties. It is patent that the present case does not fall under Section 11AC of the Act which provides for minimum penalty. The penalty has been reduced by the Tribunal after recording a finding that on account of pilferage, some goods became sub-standard which does not show any deliberate mis-statement or con­cealment by the assessee. In the circumstances, no ground is made out for interference. The appeal is dismissed.

 

Decision:-Appeal dismissed.

Comment:- It is concluded from this case that penalty under section 11AC cannot be less than duty amount but in the present case, penalty is not imposable under section 11AC as there was no misstatement or concealment by the assessee and so in such circumstances only, penalty has been reduced.

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