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TMI Blog2008 (8) TMI 119X X X X Extracts X X X X X X X X Extracts X X X X ..... r (T) Shri M.N. Bharati, Advocate, for the Appellant. Shri V.V. Hariharan, JCDR, for the Respondent. [Order per: P. Karthikeyan, Member (T)]. - This appeal arises before us for the second time. In the first round we had remanded the order appealed against to the adjudicating authority to re-quantify the demand after allowing admissible Modvat credit on inputs. The appellants M/s. Peter Miller Packers (PMP) received goods such as 'brake fluid' and 'servokool' in bulk from M/s. Indian Oil Corporation (IOC) and repacked it in containers of varying retail quantities. They also received packing materials for the above activity from IOC. By Finance Act, 1997 labelling/relabelling of containers and packing/repacking from bulk pack ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d ignorance of the new provision. The ld. Counsel submitted that PMP could have availed Modvat credit of the inputs received and paid a meager amount of duty on the value addition at their hands. Moreover, duty paid on the impugned goods would have been reimbursed by the principal manufacturer, namely, IOC. Therefore, there was no intention on the part of the PMP to evade payment of the legitimate duty due to the exchequer. They defaulted owing to their ignorance of law. Therefore, larger period could not be invoked to demand duty not paid. The transactions also did not at tract penalty as there was no deliberate evasion of the impugned amount of duty. The appellants had not followed the statutory formalities governing their activities even ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ial facts and that intention of PMP was established. We find that this finding is without any basis. We are inclined to believe that PMP did not pay the duty on the impugned goods owing to ignorance of their new liability as per the Finance Act, 1997. In the circumstances, the demand could not have been raised invoking larger period. Penalty could not have been imposed under Section 11AC and demand of interest could not have been made under Section 11AB in the absence of ingredients to invoke larger period. 4.1 Moreover, penalty need not be imposed for the reason that the statute provided for the same. In Hindustan Steel Ltd. v. State of Orissa [1978 (2) E.L.T. (J159) (S.C.)] the Hon'ble Apex Court observed as follows:- "The discr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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