9911796707
TMI Blog2007 (7) TMI 326X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee did not file any reply or documents and in spite of sufficient opportunities, it did not present its' case. Consequently, the Deputy Commissioner, Central Excise and Customs, Nanded, confirmed the notice of demand for Rs. 2,48,089/-, as also charged interest under Section 11AB of the Act and imposed penalty of Rs. 10,000/- on the assessee under Section 11AC of the Act. 3. The Department moved the Commissioner (Appeals), who enhanced the penalty to Rs. 1,00,000/-. Being dissatisfied, the Department moved the Customs, Excise and Service Tax Appellate Tribunal, West Zonal Bench, Mumbai ("CESTAT" for short), contending that penalty under Section 11AC is mandatory and, therefore, penalty amount should have been equal to the amount of duty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h is equal to the duty so determined, i.e. equal to the duty evaded intentionally. No doubt, by virtue of amendment inserted by Act 10 of 2000 with effect from 12-5-2000, discretion in the authority is vested in the cases where duty determined under Section 11A(2) and interest payable thereon under Section 11AB, is paid within thirty days from the date of communication of order of the Central Excise Officer, penalty liable to be paid by such person under Section 11AC is to be 25 per cent of the duty so determined. Even in this proviso, which provides some relaxation and relief in cases where the assessee surrenders by paying duty and interest charged thereon, even in that case, there is no discretion, so far as quantum of penalty to be imp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... favour of the authorities while exercising the power in that rule." There is no upper and lower limit prescribed for the purpose of quantum of penalty imposable under Section 11AC and, therefore, although observations of Bombay High Court quoted hereinabove are obiter dictum, so far as interpretation of Section 11AC is concerned and ratio, so far as Rule 25 is concerned, we are in agreement with the view expressed therein that under Section 11AC, there is no discretion vested with the authority to impose any penalty different than the one prescribed by the said provision. 9. The reasons for such a stiff and stringent provision, are not far to guess. As can be seen from the scheme of Sections 11A, 11AA, 11AB and 11AC of the Act, it is ev ..... X X X X Extracts X X X X X X X X Extracts X X X X
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