Central excise rule 25
RAMU HN
(Querist) 08 December 2012
This query is : Resolved
We are a manufacturer of Readymade Garments having CE Regn since 2011. We got about 7 crore order from a Delhi based Brand called Lilliput and supplied goods under proper documentation between Oct 2011 to jan 2012. Lilliput became financial bankruptsy and we have gone to court for recovery of our 4 cr rupees. Due to our customer became financial defaulter, we could not pay CE duties on time but paid completely after due dtes with interest. We have filed ER2 return on time and declared all the transaction properly and mainting proper records and documents per CE Rules. Every stage of default we have intimated Range regarding our inability to pay duties on time. But knowing all these facts and genuineness of the case Commissioenr of CE has issued a SN demanding penalty under Rule 25. But Rule 25 should be read with Section 11AC which applies only if the non payment of duty is for the reason of fraud or collusion or suipression of facts, miss statement etc. But our case is not a fraud or miss statement or supression of facts etc, but it is only delay in payment due to financial reasons as we could not get4 cr paymenbt from our customer which impacted our cash flow and hence delays happened.
Please clarify how CE can issue a SN to us under Rule 25 read with Section 11AC knowing the fact.
Ramu HN
Exim Head
Karle Group
Bangalore
9008989044
H.M.Patnaik
(Expert) 08 December 2012
I believe the problem relates to a commercial organisation and as an authorised executive of the company, you are capable hiring an experienced consultant for this purpose. Act immediately.
