Technical breach in PLA balance shortfall justified penalty reduction where there was no intention to evade duty.

Clearing goods when the PLA balance was insufficient was treated as a technical violation rather than a deliberate attempt to evade duty, because the shortfall was later rectified through TR-6 payment and the delay was attributed to an employee's mistake. On those facts, the penalty was held excessive and was reduced in favour of the assessee.

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Issues: Whether the penalty imposed for clearing goods when the balance in the PLA was insufficient required reduction on the ground that the default was only a technical violation and not a deliberate attempt to evade duty.

Analysis: The assessee had cleared the goods when the PLA balance was inadequate, but the credit was subsequently made through the TR-6 challan and the surrounding circumstances indicated no deliberate intention to evade duty. The Tribunal treated the lapse as a technical violation and accepted that the delay arose from an employee's mistake. In view of these facts, the original penalty was found to be excessive.

Conclusion: The penalty was reduced from Rs. 20,000/- to Rs. 500/- in favour of the assessee.

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