Cce, Raipur vs Shivalaya Ispat & Power Pvt. Ltd

[Arising out of Order-in-Appeal No.126/RPR-I/2008 dated 19.09.2008 passed by the Commissioner, Customs & Central Excise, Raipur]

For approval and signature:

HONBLE MR. S.K. MOHANTY, MEMBER (JUDICIAL)

1. Whether Press reporters may be allowed to see the

order for publication as per Rule 27 of the CESTAT

(Procedure) Rules, 1982?

2. Whether it should be released under Rule 27 of the

CESTAT (Procedure) Rules, 1982 for publication in

any authoritative report or not?

3. Whether Their Lordships wish to see the fair copy

of the Order?

4. Whether Order is to be circulated to the Departmental

authorities?

__________________________________________________

CCE, Raipur Appellant

Vs.

Shivalaya Ispat & Power Pvt. Ltd.  Respondent

Present for the Appellant : Shri R.K. Mishra, D.R.

Present for the Respondent: Shri Manish Saharan, Advocate

Coram: HONBLE MR. S.K. MOHANTY, MEMBER (JUDICIAL)

Date of Hearing/Decision: 27.05.2015

FINAL ORDER NO. 53008/2015

PER: S.K. MOHANTY

The Revenue is in appeal against the impugned order dated 19.09.2008 passed by the Commissioner (Appeals), Raipur, wherein penalty impose in the adjudication order has been modified to the extent of reducing the same to 25% under Section 11AC of the Central Excise Act, 1944. The reason for reduction of the quantum of penalty is that the appellant had already paid the duty alongwith interest and 25% of penalty prior to finalisation of the show cause proceedings at the original adjudication stage.

2. Heard the ld. Counsels for both the sides and perused the records.

3. The ld. DR Shri R.K. Mishra appearing for the appellant while reiterating the grounds of appeal annexed to the appeal memorandum, further submits that in case of fraud, collusion, suppression of fact with intent to evade payment of duty, equal amount of penalty is required to be paid even if the amount of duty and interest has been paid before issuance of show cause notice.

4. Per contra, the ld. Advocate appearing for the respondent submits that since the respondent had already deposited the entire duty alongwith interest and 25% of penalty before determination of duty liability by the adjudicating authority, their case squarely covered under the first proviso to section 11AC of the Central Excise Act and the Commissioner (Appeals) is justified in reducing the quantum of penalty to 25% in the impugned order.

5. Section 11AC of the Central Excise Act, 1944 deals with imposition of penalty for short levy or non-levy of duty. The quantum of penalty to be imposed has been specified in the said section, which is equal to the duty as determined under sub-section (2) of Section 11 A of the Act. However, in the first proviso appended to section 11AC, it has been specified that if the duty determined under sub-section (2) of section 11 A alongwtih interest thereon is paid within thirty days from the date of communication of the order determining such duty, the amount of penalty liable to be paid by the assessee shall be 25% of the duty so determined.

6. It is an admitted fact on record that the entire amount of Central Excise Duty, interest and 25% penalty in question has been paid by the appellant on 16, 17 and 23.08.2007, whereas the show cause notice dated 13.07.2007 was adjudicated on 12.06.2008. Since the above amount has already been paid prior to determination of duty liability by the adjudicating authority, the case of the respondent squarely covered under the first proviso to Section 11AC of the Act and there is no question of payment of any further amount towards penalty. Therefore, I do not find any infirmity in the impugned order passed by the Commissioner (Appeals) in reducing the quantum of penalty to 25%. Thus, there is no merit in the appeal field by the Revenue and the same is dismissed.

(Dictated and pronounced in the open Court)

(S.K. MOHANTY)

MEMBER (JUDICIAL)

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