Substantial question of law and actual grievance were absent, so the revenue appeal against credit and penalty treatment failed.

A revenue appeal under Section 35(G) of the Central Excise Act was held not to raise a substantial question of law where the Tribunal had merely left the credit issue on inputs in stock and work-in-process for decision by the competent authority and no real prejudice was shown. The Court also found no sustainable ground on the contention that penalty equal to duty was mandatory, because the appeal did not arise from any surviving grievance against the penalty treatment and no further relief had been granted on that aspect. The revenue appeal therefore failed, and the Tribunal's order remained undisturbed.

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Issues: (i) whether any substantial question of law arose from the Tribunal's refusal to grant the revenue relief against the credit-related demand, and (ii) whether the plea that penalty equal to duty was mandatory required interference in the revenue's appeal.

Issue (i): Whether any substantial question of law arose from the Tribunal's refusal to grant the revenue relief against the credit-related demand.

Analysis: The appeal was under Section 35(G) of the Central Excise Act, 1944 and challenged the Tribunal's order concerning credit consequences when the assessee had availed exemption under Notification No. 6/2000-C.E. The Tribunal had noted that the assessee was not contesting the demand for the period when exemption was enjoyed and had only left open the separate issue of credit relating to inputs in stock and work-in-process for consideration by the competent authority. On that basis, the revenue could not show any real prejudice from the Tribunal's order on the issue raised.

Conclusion: No substantial question of law arose on this issue, and the contention failed.

Issue (ii): Whether the plea that penalty equal to duty was mandatory required interference in the revenue's appeal.

Analysis: Although the Court noted that a similar contention regarding mandatory penalty had been accepted in an earlier decision, the present appeal did not arise from any grievance of the revenue against the reduction of penalty by the appellate authority, and the Tribunal had granted no further relief to the assessee on that aspect. In the absence of any surviving grievance, the proposed question did not warrant admission or interference.

Conclusion: The mandatory-penalty contention did not give rise to any sustainable ground for the revenue.

Final Conclusion: The revenue's appeal failed in its entirety, leaving the Tribunal's disposal undisturbed.

Ratio Decidendi: A revenue appeal under Section 35(G) of the Central Excise Act, 1944 does not lie where the appellant cannot demonstrate an actual grievance or a substantial question of law arising from the order challenged.

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