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TMI Blog2014 (12) TMI 863X X X X Extracts X X X X X X X X Extracts X X X X ..... mandate under the Statute cannot be given a go-by by the Tribunal. We therefore, answer the question of law in favour of the Revenue - Decided in favour of Revenue. - Civil Miscellaneous Appeal No.1099 of 2008 - - - Dated:- 12-12-2014 - R. Sudhakar And R. Karuppiah,JJ. For the Appellant : Mr. E. Vijay Anand For the Respondent : Mr. K. Magesh - R1 JUDGMENT (Delivered by R. Sudhakar,J.) This Civil Miscellaneous Appeal filed as against the order of the Customs, Excise and Service Tax Appellate Tribunal was admitted by this Court on the following substantial questions of law: 1. Whether Section 11AC can be invoked for imposing penalty on such circumstance where an assessee did not pay duty at the time of removal/cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... EPL were a registered assessee under the Central Excise Rules, the goods were seized under a mahazar on 01.03.1997. Therefore, show cause notice was issued demanding duty of ₹ 4,25,295/- for the period covering 1995-96 and 1996-97 under proviso to Section 11A(1) of the Central Excise Act, 1944. The Original Authority also confiscated the seized goods under Rule 173Q(2) of Central Excise Rules, 1944, imposed penalty of ₹ 30,000/- for contravention of Rule 173Q of the Central Excise Rules and demanded interest under Section 11AB of Central Excise Act, 1944. The Original Authority after due process of law waived the mandatory penalty under Section 11AC of Central Excise Act, 1944. 3. Aggrieved by the order of the Original Author ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... demand of duty confirmed by the original authority had been paid prior to 26.8.97 (the date of issue of show-cause notice), the remaining part having been paid after that date. However, this change of factual situation would not necessarily warrant a change in the conclusion reached in para (4) of the final order. In the case of CCE Vs. KJON Engineering (P) Ltd. - 2005 (67) RLT 157 (Mad.), the Hon'ble High Court had considered a factual situation similar to the one presented today by the department and, on such facts, it was held that Section 11AC penalty was not impossible. In other words, where the duty amount was paid atleast prior to the date on which the order of adjudication was passed, Section 11AC is not liable to be invoked for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roviso to Section 11A(1) of the Central Excise Act. The issue as to whether penalty can be reduced in any manner came up for consideration before the Supreme Court in the decision reported in 2008 (231) E.L.T. 3 (S.C.) (Union of India V. Dharamendra Textile Processors). In such circumstances, the decision of the Larger Bench of the Supreme Court in the decision reported in 2008 (231) E.L.T. 3 (S.C.) (Union of India V. Dharamendra Textile Processors) makes it very clear that penalty under Section 11AC of the Central Excise Act is mandatory and there is no element of discretion. 8. While considering the pari materia provision, namely, Section 11AC of the Central Excise Act, the Supreme Court in the decision reported in 2008 (231) E.L.T. 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat is stated above in regard to the decision in Dharamendra Textile is only in so far as Section 11AC is concerned. We make no observations (as a matter of fact there is no occasion for it!) with regard to the several other statutory provisions that came up for consideration in that decision. 25. In the light of the discussion made above it is evident that in both the appeals, orders were passed by the Tribunal on a wrong premise. In both the appeals, therefore, the impugned orders passed by the Tribunal are set aside and the matters are remitted to the respective Tribunals for fresh consideration, in accordance with law, and in the light of this judgment.... 10. In view of the categorical statement of law and taking note of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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