2017 (1) TMI 217

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..... e Act, 1944 - after payment of duty along with interest by the appellant, the department should have concluded the matter and no penalty was imposable - penalty set aside - appeal allowed - decided in favor of assessee.
Mr. Ramesh Nair, Member (Judicial) And Mr. C.J. Mathew, Member (Technical) Shri Prasad Paranjape, Advocate for Appellant Shri N.N. Prabhudesai, Supdt. (A.R) for respondent Per : Ramesh Nair The issue involved in the present case is that in the event of non-inclusion of value of the free supply material by the customer in the manufactured excisable goods whether the penalty under Rule 25 of Central Excise Rules is leviable or otherwise. 2. The fact of the case is that the appellant have not included the value of the m .....

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..... ions made by both the sides. We find that the issue falls under narrow compass as it is confined to imposition of penalty under Rule 25 of the Rules. As per the undisputed facts the issue was raised in the audit regarding the valuation. The appellant admittedly paid the entire amount of duty along with interest and did not intend to contest merit. In view of this fact, we are of the view that the case of the appellant is squarely covered by Section 11A(2B) of the Central Excise Act, 1944, which is reproduced below: "Section 11A(2B) in the Central Excise Act, 1944 [(2B) Where any duty or excise has not been levied or paid or has been short-levied or short-paid or erroneously refunded, the person, chargeable with the duty, may pay the amou .....

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..... ion.] 72 [ Explanation 3 .-For the removal of doubts, it is hereby declared that no penalty under any of the provisions of this Act or the rules made thereunder shall be imposed in respect of payment of duty under this sub-section and interest thereon." As per the plain reading of the above provision, we find that since the appellant, without contesting the differential duty raised by the department, paid the entire duty along with the interest, the case is covered by the above provision. According to which even the show cause notice was not required to be issued. We, therefore, considered the above provision and entire facts and circumstances of the case that after payment of duty along with interest by the appellant, the department shoul .....

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