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2018 (3) TMI 1693 - AT - Central ExcisePenalty u/s 11AC - case of appellant is that prior to 28.09.1996, the provisions of Section 11AC of the Act were not in the statute books from 1995 to 28.09.1996 - Held that - In the impugned order, penalty imposed on the appellant is under Section 11AC of the Act and in the matter, period involved is prior to 28.08.1996 also. Therefore, the duty confirmed for the period from 1995 to 28.09.1996, penalty is not imposable. The impugned order is modified to the extent that penalty equal to duty is not imposable upto 28.09.1996 i.e. for the period prior to 28.09.1996 the demand of duty is confirmed but the penalty imposed on the appellant is reduced equal to duty for prior to 28.08.1996 - appeal allowed in part.
Issues: Appeal against penalty imposed under section 11AC of the Act
In this case, the appellant appealed against the penalty imposed under section 11AC of the Act. The appellant had already lost the case on merits, but the issue at hand was the period involved, which was from 1995 to 1998. The show cause notice proposed to impose a penalty on the appellant under section 11AC of the Act and Rule 173Q of the Central Excise Rules, 1944. The adjudicating authority did not impose any penalty under Rule 173Q but imposed a penalty under section 11AC of the Act, equal to the duty involved. The appellant argued that prior to 28.09.1996, the provisions of Section 11AC were not in the statute books, and therefore the penalty equal to the duty under Section 11AC should not be imposed for the period before that date. The Tribunal considered the arguments and noted that the penalty imposed on the appellant was under Section 11AC of the Act for the period prior to 28.09.1996. As the provisions of Section 11AC were not in effect before 28.09.1996, the Tribunal held that the penalty equal to duty is not imposable for the period from 1995 to 28.09.1996. Therefore, the impugned order was modified to reduce the penalty imposed on the appellant equal to duty for the period before 28.08.1996. The demand of duty was confirmed, but the penalty was reduced for the period prior to 28.08.1996. In conclusion, the appeal was disposed of with the modification that penalty equal to duty is not imposable for the period before 28.09.1996. The Tribunal clarified the penalty imposition under Section 11AC of the Act and upheld the demand of duty while reducing the penalty for the specified period.
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