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Central Excise
Is penalty under Sec 11AC mandatory and is mens rea an essential requirement? - Issue referred to Larger Bench : Supreme Court
IN this batch of Civil Appeals, the question for determination is whether Section 11AC of the Central Excise Act, inserted by Finance Act, 1996 with the intention of imposing mandatory penalty on persons who evade payment of tax, should be read to contain mens rea as an essential requirement.
The judgment in the case of Dilip N.Shroff Vs. Joint Commissioner of Income Tax, Mumbai needs consideration by the larger Bench of this Court particularly when it has ramifications not only regarding provisions of the Income Tax Act but also with regard to the provisions of Sections 3A and 11AC of the Central Excise Act and Rule 96ZQ(5) of the Central Excise Rules.
Lex non cogit ad impossibilia - payment of duty on supplementary invoice cannot attract interest u/s 11AB of Excise Act : Tribunal
Relying on the Bombay HC decision in Indian Seamless Steel & Alloys Ltd, , the Commissioner(A) held that if the unforeseen circumstances beyond the control of the assessee result in non-payment of duty, such circumstances cannot be construed to mean that the appellant had failed to pay the excise duty on the due date & hence the legal maxim " lex non cogit ad impossibilia " [ the law does not compel a man to do that, which he cannot possibly perform ] is squarely attracted to the case. In short, no interest is payable either under rule 8(3) or S. 11AB of the CEA'44.
Fortunately, the Tribunal did not go into the merits of the COD application else Revenue would have had another embarrassment on their hands. As for the issue of interest u/s 11AB in respect of supplementary invoices, the Tribunal has consistently held in the cases of Rucha Engineering, , Chloritech Engineering & Force Motors, , that when differential duty is paid due to price escalation, interest is not required to be paid under s.11AB of the CEA'44 as there has been no determination of duty under section 11A(2). Probably, Revenue does not have any "INTEREST" in these Tribunal decisions!
Income Tax
Learned DR fairly conceded - No, he cannot! - Income Tax - Departmental Representative's job is to appear, plead and act FOR the Revenue - he cannot concede : ITAT
As per Rule 2 of the ITAT Rules, "authorized representative" means in relation to an income-tax authority who is a party to any proceeding before the Tribunal, a person duly appointed by the Central Government by notification in the Official Gazette as authorized representative to appear, plead and act for such authority in any such proceeding and any other person acting on behalf of the person so appointed.
Obviously this will apply to CESTAT also. So now DRs cannot concede a point even if it is wrong. And in future orders of Tribunal will not have words like, the "Learned DR fairly conceded".
Until Tomorrow with more DDT
Have a nice day.
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