Fresh show cause notice on identical duty default held unsustainable while earlier demand remained under challenge.

A fresh show cause notice proposing penal action for late payment of duty under the compounded levy scheme was unsustainable where it rested on the same default, amount and period as an earlier demand already under challenge before the Tribunal. The Commissioner (Appeals) had found the original demand unsustainable, and that order had not been reversed or modified by any competent authority. The Revenue could not initiate a second proceeding on an identical issue while the matter remained sub judice, and the subsequent notice was liable to be quashed.

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Issues: Whether a subsequent show cause notice proposing penal action for late payment of duty under the compounded levy scheme could be sustained when the earlier demand on the same issue and for the same period was already under challenge before the Tribunal.

Analysis: The notice was founded on the same default, the same amount and the same period as the earlier demand. The Commissioner (Appeals) had already held the demand unsustainable, and that order had not been modified or reversed by a competent authority. In these circumstances, the Revenue could not initiate another proceeding by issuing a fresh notice on an identical issue while the matter remained sub judice before the Tribunal.

Conclusion: The subsequent show cause notice was held to be unsustainable in law and liable to be quashed.

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