Reduced penalty under Central Excise law requires strict compliance with the statutory payment deadline from the original order.

Section 11AC of the Central Excise Act permits a reduced penalty of 25% only on strict compliance with the statutory conditions, including payment of duty, interest and the reduced penalty within 30 days from communication of the original adjudicating authority's order. The provision does not require a separate determination of 25% penalty by the adjudicating authority, and the appellate forum cannot extend or re-open the statutory time limit. The reduced-penalty concession is therefore conditional and must be availed within the period fixed by the statute.

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Issues: Whether, for penalty under Section 11AC of the Central Excise Act, 1944, the assessee could be permitted to pay 25% of the penalty within 30 days from the date of communication of the Tribunal's order when the statutory conditions for reduced penalty were not complied with within 30 days from the adjudicating authority's order determining duty.

Analysis: Section 11AC, as applicable to the case, mandated penalty equal to the duty determined under Section 11A(2) where duty had been evaded with the requisite culpable intent. The first proviso granted a limited concession reducing penalty to 25% only if the duty, interest under Section 11AB, and the reduced penalty were all paid within 30 days from communication of the order of the Central Excise Officer determining duty. The second proviso made the reduced penalty available only upon payment of that amount within the same statutory period. The provision did not cast any duty on the adjudicating authority to determine 25% penalty separately, and the appellate authority could not extend or enlarge the statutory time limit. The benefit of reduced penalty was therefore conditional and had to be strictly complied with within the prescribed period.

Conclusion: The assessee was not entitled to pay 25% penalty within 30 days from the Tribunal's order, and the reduced penalty benefit under Section 11AC was unavailable. The question was answered against the assessee and in favour of the Revenue.

Final Conclusion: The statutory concession under Section 11AC could be availed only by strict compliance with the time-bound conditions attached to the original adjudication order, and the appellate forum had no power to confer that benefit afresh.

Ratio Decidendi: Where a penal statute grants a reduced-penalty concession subject to payment within a fixed statutory period from the original adjudicating order, the time limit is mandatory and cannot be extended by the appellate authority.

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