Mandatory excise penalty and reasoned appellate orders: Tribunal rulings set aside and matters remanded for fresh adjudication.

Section 11AC penalty under the Central Excise Act is described as mandatory once the statutory conditions are met, so pre-show-cause payment of duty does not by itself justify waiver on equitable grounds where suppression is alleged. The Tribunal's contrary view was set aside and the issue was remanded for reconsideration. The text also states that an appellate order dismissing refund appeals must give reasons; a cursory, non-speaking order is unsustainable and was set aside, with remand for a reasoned decision. The departmental appeals were allowed and both matters were sent back for fresh adjudication in accordance with law.

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Issues: (i) Whether penalty under Section 11AC of the Central Excise Act, 1944 could be waived on the ground that duty was paid before issuance of the show cause notice despite alleged suppression of facts. (ii) Whether the Tribunal could sustain dismissal of the Revenue's refund appeals by a cursory and non-speaking order.

Issue (i): Whether penalty under Section 11AC of the Central Excise Act, 1944 could be waived on the ground that duty was paid before issuance of the show cause notice despite alleged suppression of facts.

Analysis: The governing law, as declared by the Supreme Court, is that penalty under Section 11AC is mandatory once the statutory conditions are attracted and the authority has no discretion to reduce the penalty on equitable considerations. The Court also noted its earlier view that the issue required reconsideration in the light of the mandatory nature of the provision and the relevant notification governing the period in question.

Conclusion: The Tribunal's view that mandatory penalty was not leviable was set aside, and the matter was remanded for reconsideration.

Issue (ii): Whether the Tribunal could sustain dismissal of the Revenue's refund appeals by a cursory and non-speaking order.

Analysis: An appellate order must record reasons when it decides a challenge on merits. The Tribunal's order dismissing the Revenue's refund appeals contained no reasoning or analysis and was therefore treated as a cursory order incapable of being sustained.

Conclusion: The dismissal of the refund appeals was set aside and the matter was remanded to the Tribunal for a reasoned decision.

Final Conclusion: The departmental appeals were allowed, and both issues were sent back to the Tribunal for fresh adjudication in accordance with law.

Ratio Decidendi: Where a statutory penalty provision is mandatory, waiver cannot rest on discretion once the provision is attracted, and an appellate disposal without reasons is unsustainable.

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