The appellant in this case is engaged in the manufacture of excisable goods. During the material period, they were liable to pay duty in terms of Rule 8 of the Central Excise Rules, 2002. In respect of clearances made in every calendar month, they should have paid duty by the fifth day of the next month (due date) and, in any case, within 30 days (grace period) thereafter, with interest. But, for April, May and June 2008, the appellant did not pay duty in this manner. They paid duty from PLA for these three months on 4-8-2008 with interest, the delay of payment beyond the grace period being 92 days, 61 days and 30 days respectively. The relevant particulars of payment of duty for the three months are as tabulated below :

A manufacturer of excisable goods, having defaulted payment of duty in the aforesaid manner, had a further liability under Rule 8(3A). Accordingly, the appellant, in the month of July 2008, should have paid duty on each clearance at the time of such clearance and, that too, without utilization of Cenvat credit. In other words, the payment of duty for July 2008 ought to have been consignment-wise and from the account current (PLA). The appellant, however, utilized Cenvat credit to the extent of Rs. 67,619/- for payment of duty of Rs. 1,40,840/- for the month of July 2008, the differential amount having been made from PLA. The payment for the entire month, partly from PLA (Rs. 74,448/-) and partly from Cenvat account (67,619/-) was made on 23-8-2008. The interest thereon was also paid on that date. In adjudication of the relevant show cause notice, the original authority confirmed against the assessee demand of duty of Rs. 67,619/- under Section 11A of the Central Excise Act, demanded interest thereon under Section 11AB of the Act and imposed a penalty of Rs. 2000/- on the assessee under Rule 25 of the Central Excise Rules. In an appeal filed by the assessee, the Commissioner (Appeals) upheld the order-in-original. Hence the present appeal of the assessee.

2. The learned counsel for the appellant submits at the outset that their only grievance is against the demand of duty of Rs. 67,619/-. Though, in the memo of appeal, there is a formal challenge to the aforesaid penalty, the same is not being pressed. With regard to the demand of duty, the learned counsel submits that, as the appellant had cleared all the duty dues with interest prior to 5th of August 2008 for the period April to June 2008, their case is covered by Rule 8(3) and not Rule 8(3A). In other words, the argument is that the appellant was entitled to utilize Cenvat credit for payment of duty for the month of July 2008. Without prejudice to this argument, the learned counsel submits that, in terms of Rule 8(3A), the appellant could at best be required to pay the aforesaid amount of duty from PLA and claim recredit of equal amount in Cenvat account. In this connection, reliance is placed on the Tribunal's decision in SCT Ltd. v. CCE, Meerut [2006 (202) E.L.T. 814 (Tri.-Del.)] and Nehru Steels v. CCE, Kanpur [2008 (231) E.L.T. 349 (Tri.-Del.)]. The learned counsel has interpreted Rule 8(3A) in the same manner as done by this Tribunal in the case of Solar Chemferts Pvt. Ltd. v. CCE, Thane-I [2012 (276) E.L.T. 273 (Tri.-Mum.)]. Finally it is argued that, in the circumstances of this case, the impugned demand of duty is liable to be set aside on equitable considerations.

3. The learned Deputy Commissioner (AR) has focused his submissions around Rule 8(3A). It is submitted that, by not paying duty consignment-wise in July 2008 and by utilizing Cenvat credit for the payment of duty for the said month, the assessee attracted Section 11A of the Central Excise Act inasmuch as the goods on which duty was paid