Equal penalty under Section 11AC applies where duty is confirmed and no bona fide classification dispute is shown.

Equal penalty under Section 11AC of the Central Excise Act was treated as exigible where the duty demand stood confirmed and there was no material showing payment within the stipulated period. In the absence of any established bona fide belief or classification dispute to take the matter out of the mandatory penalty regime, the reduced penalty imposed by the Commissioner (Appeals) was not sustained. The penalty was restored to the full amount of the confirmed duty demand, in favour of the Revenue.

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Issues: Whether equal penalty under Section 11AC of the Central Excise Act, 1944 was mandatory on confirmation of the duty demand, and whether the reduced penalty sustained by the Commissioner (Appeals) was liable to be restored.

Analysis: The appeal proceeded on the basis that the duty demand had been confirmed and that there was no material showing payment of duty within the stipulated period. The record also disclosed no established bona fide belief or classification dispute to take the case out of the mandatory penalty regime. In these circumstances, the reasoning applied to support imposition of equal penalty under Section 11AC.

Conclusion: Equal penalty under Section 11AC was held to be exigible, and the penalty was restored to the full amount of the confirmed duty demand, in favour of the Revenue.

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