2009 (8) TMI 594

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..... e goods cleared without payment of duty cannot be treated as exempted goods for the reason that they were further used in the manufacture of final products cleared on payment of duty. The demand of Rs. 88,982/- is therefore set aside. Thus the appeal is partly allowed by setting aside the demand of Rs. 88,982/- and the penalty of equal amount and penalty of Rs. 1,52,307/- while upholding the deman .....

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..... of holding that the assessees were required to reverse credit availed on inputs used in the manufacture of final products cleared without payment of duty. 2. I have heard both sides. The appellants do not dispute the liability of Rs. 1,52,307/-. They only dispute their liability to equal penalty on the ground that although the amendment to Rule 3(4) was introduced on 1-3-03, they were not aware .....

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..... therefore, the plea of the assessees that they were ignorant of the same for some period of time can be accepted. Further, although ignorance of law is a plea which can be pressed into service for non-imposition of penalty, it is not open to the department to contend that departmental officers were not aware of the amendment and, therefore, nothing prevented the authorities from issuing show-cause .....

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