2008 (11) TMI 450 - AT - Central Excise

Summary

Issues: Revenue's appeal for enhancement of penalty under Rule 25(1) of the Central Excise Rules.

The judgment pertains to an appeal by the Revenue seeking an increase in the penalty imposed under Rule 25(1) of the Central Excise Rules. The respondent, engaged in the manufacture of excisable goods, had defaulted on duty payment on three occasions despite subsequently paying the duty along with interest. The Assistant Commissioner initially imposed a penalty of Rs. 10,000, which was later reduced to Rs. 5,000 by the Commissioner (Appeals). The Revenue contended that the penalty should not be less than Rs. 10,000 as per the rule's provisions, which state that the penalty shall not be less than the duty amount or Rs. 10,000, whichever is more.

The respondent requested a decision on merit, and the matter was heard. The Tribunal found the penalty reduction to Rs. 5,000 below the minimum prescribed under Rule 25(1) to be prima facie incorrect. Consequently, the penalty on the respondent was increased to Rs. 10,000, in line with the rule's requirements. The impugned order was modified accordingly, and the Revenue's appeal was allowed. The judgment was dictated and pronounced in open court by the Tribunal.