Appellate Tribunal Upholds Commissioner's Decision Setting Aside PenaltySmt. Archana Wadhwa, J. REPRESENTED BY : Shri J.R. Madhiam, JDR, for the Appellant. Shri K.P. Dey, Advocate, for the Respondent. [Order]. - The Revenue in the present appeal filed against the order of Commissioner (Appeals) has challenged that part of the order vide which the appellate authority has set aside the penalty imposed upon the respondents. 2. As per facts on record the appellants had manufactured and cleared paints remover falling under sub-heading No. 3814.00 of CETA witho... ... ... Issues:
Challenge to setting aside of penalty imposed on respondents by Commissioner (Appeals).

Analysis:
The appeal before the Appellate Tribunal was filed by the Revenue against the order of the Commissioner (Appeals) challenging the setting aside of the penalty imposed on the respondents. The appellants had manufactured and cleared paints remover without payment of duty under sub-heading No. 3814.00 of CETA. Upon notification of this, the respondents promptly paid the duty, claiming they were unaware of the goods' excisability. The Commissioner (Appeals) found no mala fide intent on the respondents' part as they maintained proper records, which were presented to the departmental officers for verification. Consequently, the penalty was set aside by the Commissioner (Appeals).

The Commissioner (Appeals) noted that penal provisions under Section 11AC were not applicable as the duty was paid before the issuance of the show cause notice. However, the Appellate Tribunal emphasized that the imposition of penalty hinges on the specific circumstances of each case. In this instance, it was undisputed that the respondents acted in good faith, believing the goods were non-excisable, and diligently maintained accurate records. Moreover, the duty was paid prior to the show cause notice. Considering these factors, the Tribunal agreed with the Commissioner (Appeals) that penalizing the respondents was unwarranted. Therefore, the Tribunal upheld the decision of the Commissioner (Appeals) and dismissed the Revenue's appeal. Penalty - Imposition of COMMISSIONER OF C. EX., KOLKATA-I Versus CENTURY PAINTS & VARNISH WORK
Central Excise
2004 (2) TMI 481 - CESTAT, KOLKATA - 2004 (168) E.L.T. 62 (Tri. - Kolkata)
CESTAT, KOLKATA - AT
Dated:- 20-2-2004
ESM/91/2003 - A/176/KOL/2004
Central Excise
Smt. Archana Wadhwa, J. REPRESENTED BY : Shri J.R. Madhiam, JDR, for the Appellant. Shri K.P. Dey, Advocate, for the Respondent. [Order]. - The Revenue in the present appeal filed against the order of Commissioner (Appeals) has challenged that part of the order vide which the appellate authority has set aside the penalty imposed upon the respondents. 2. As per facts on record the appellants had manufactured and cleared paints remover falling under sub-heading No. 3814.00 of CETA without payment of duty. When brought to their notice the respondents immediately paid the duty and contended that they were under the impression that goods in question were not excisable. There was no mala fide on their part inasmuch as they were maintaining all the records for manufacture and removal of the goods and the same were produced for verification before the departmental officers. As such by observing that there was no suppression on the part of the respondents the Commissioner (Appeals) has set aside the penalty. 3. Though the Commissioner (Appeals) in his impugned order has also observed that inasmuch as the respondents paid the duty before issuance of the show cause notice, penal provisions under Section 11AC are not attracted. However, I am of the view that imposition of penalty depends upon the facts and circumstances of each particular case. In the present case the fact that the respondents had maintained the records and were entertaining a bona fide belief about the non-excisability of the goods and were maintaining proper records, which were submitted before the officers and the fact that the duty was paid before the issuance of the show cause notice are not disputed. In these circumstances the imposition of penalty upon the respondents is not called for. For the said reason I do not find any infirmity in the view taken by Commissioner (Appeals) and reject the appeal filed by the Revenue.
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