9911796707
TMI Blog2004 (8) TMI 524X X X X Extracts X X X X X X X X Extracts X X X X ..... ecember, 1993. Modvat credit on the inputs used in the manufacture of these bodies was taken and was utilised for clearance of the bodies which were cleared on payment of duty. They were contesting credit on removals of certain goods as they were contesting duty liability. The issue, as regards their activity being of excisable nature as conducted was in dispute. It was settled in their favour. On 16-12-1994 the assessee informed the department that they were eligible for Modvat credit/input credit, as their products were excisable and the credits reversed with effect from 1-3-1992 will be taken in their RG23A Part II register and accordingly a credit amount of Rs. 22,73,973/- was taken on 3-1-1995 and Rs 1,27,605/- in their PLA on that dat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 78/- was no more open. Hence this appeal. 2. After hearing both sides, it is found that : (a) Show Cause Notices dated 5-5-1993, 3-11-1993, 22-12-1993 and 26-5-1994 demanding duty on bodies fitted on semi-finished jeeps were decided by the Assistant Commissioner vide an Order dated 13-2-1995 and duty demand of Rs. 26,9,055/- were confirmed. In appeal against this demand, the Commissioner (Appeals) vide his Order No. P-107/96, dated 26-2-1996 directed the Assistant Commissioner to redetermine the liability after considering abatement on account of duty element not including fitment charges. The Assistant Commissioner redetermined the liability to 6006238 vide his Order dated 4-4-1996. (b) The plea of the appellants that they wo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sal made. 3. The issue before us are only the duty demand of Rs. 19,473/- on 7 jeeps fitted with bodies which are deemed to be cleared without payment of duty as also the seizure of jeeps and redemption fine of Rs. 1.00 lakh and a penalty of Rs. 1.00 lakh are the issues before us. We find that duty demand of Rs. 19,473/- as confirmed will not and cannot call for the penalty of Rs. 1.00 lakh under Rule 173Q as arrived at. The penalty imposed is totally disproportionate and not called for in the facts and circumstances of this case, since the issue of levy of excise duty on the activity itself was in doubt and was disputed by the assessee. We therefore would consider that no penalty under Rule 173Q could be called for in the facts and circu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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