2007 (2) TMI 378

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....e on 22-7-2003. 2. The adjudicating authority had disallowed Cenvat credit of Rs. 1,03,360/-, ordered its recovery from the respondent along with the interest and imposed penalty of Rs. 25,840/-, which was 25% of the duty amount.  The adjudicating authority held : "Penalty of Rs. 25,840/- i.e. 25% of the duty amount had also been deposited on 29-7-2003 along with the interest of Rs. 7012/- vide TR-6 challan No. 5 dated 29-7-2003". 3. The penalty @ 25% appears to have been imposed by the adjudicating authority in view of the provisions of the first proviso to Section 11AC, under which it was provided that where duty as determined under sub-section (2) of Section 11A, and the interest payable thereon under Section 11AB....

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....djudication order. 6. In the context of the above facts, the first proviso to Section 11AC of the said Act is reproduced below : "Provided that where such duty as determined under sub-section (2) of Section 11A, and the interest payable thereon under Section 11AB, is paid within thirty days from the date of communication of the order of the Central Excise Officer determining such duty, the amount of penalty liable to be paid by such person under this section be twenty-five per cent of the duty so determined". 6.1 The first proviso to Section 11AC contemplates the penalty liability to be only of 25% of the duty determined in place of penalty equal to the duty determined. Therefore, in cases where the amounts are paid in accorda....