2004 (2) TMI 588 - AT - Central Excise

Summary

Issues: Imposition of penalty and interest when duty is paid before the issuance of show cause notice.

Analysis:
The case involves an appeal by the Revenue against the order of the Commissioner (Appeals) setting aside the penalty imposed on the ground that duty had been paid before the show cause notice was issued. The appellants contended that the penalty was unwarranted as they had deposited the entire duty amount before the notice. The Tribunal referred to various judgments, including those in the cases of Amritsar Crown Caps, Ikon Engg. Ltd., Rashtriya Ispat Nigam Ltd., and Oudh Sugar Mills Ltd., which held that penalty and interest are not attracted if duty is paid before the issuance of show cause notice. The Tribunal, respecting the ratio of these decisions, set aside the imposition of penalty and interest due to the duty being reversed before the notice was issued.

In the subsequent analysis, the judge referred to the judgments in the cases of Ashok Leyland Ltd. and Rashtriya Ispat Nigam Ltd., which were confirmed by the Apex Court. These judgments held that when duty is paid before the issuance of show cause notice, penalty and interest are not leviable unless there is an allegation of suppression. The judge concluded that the issue had already been decided by the Tribunal and confirmed by the Apex Court, and therefore, upheld the order of the Commissioner (Appeals) setting aside the penalty. The judge found no merit in the Revenue's appeal and rejected the same, affirming the decision to set aside the penalty.