9911796707
TMI Blog2006 (9) TMI 367X X X X Extracts X X X X X X X X Extracts X X X X ..... ent. [Order]. This appeal is filed against the order in appeal dated 16-7-2004 which upheld the order in original and sustained the confirmation of duty and penalty on the appellant. 2. The relevant fact that arise for consideration are the appellants are availing Modvat credit on the inputs i.e. transformer oil in their factory. The appellants are engaged in the manufacture of transfo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Section 11AC. Hence this appeal. 3. he learned consultant appearing for the appellants submits that, the appellant is not disputing that they are liable to pay the amount of duty on the transformer oil used for repairing of transformer. His contention is against the penalty that has been imposed on the appellant. It is his submission that the learned Commissioner (Appeal) has upheld the penalt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ernment agencies and clearing the same without payment of duty. The cardinal principal for availment of Modvat credit on any inputs is that the input should have been used on any relation to the final product on which the appropriate duty is paid. It is very evident from the records that the appellant had not paid any duty on the transformers which were repaired and cleared by them. If that be so, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nalty imposed on the appellant under Rule 173Q is liable to be set aside and I do so. 7. As regard, the penalty imposed on the penalty under provisions of Section 11AC, I find that the provisions of Section 11AC has been invoked against the appellant on the ground that they had suppressed the facts of use of modvatted transformer oil in transformers which were repaired. I find from the records t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be visited with equivalent amount of penalty. 8. In the facts and circumstances of the case, to my mind, the penalty imposed on the appellant under Section 11AC is liable to be reduced to Rs. 50,000/- (Rupees Fifty Thousand only) to meet the ends of justice. 9. Accordingly, the impugned order is modified to the extent, as indicated in the above paragraphs and appeal filed by the appellant is a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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