2009 (3) TMI 658

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.... Chandigarh. By the Original Order dated 16th Jan 2004, the Additional Commissioner, Chandigarh had confirmed the demand of Rs. 8,02,691/- against the respondent under Section 11A of the Central Excise Act, 1944 by invoking extended period of limitation and had directed to pay the interest as also personal penalty of Rs. 1.00 Lakh under Rule 173Q of the Central Excise Rules, 1944 and personal penalty of Rs. 8,02,691/- under Section 11AC of the said Act. The Commissioner (Appeals) by the impugned order set aside the penalty. 3. According to DR the ground on which the penalty imposed by the lower authority has been set aside by the Commissioner (Appeals) is not born out from the record as also that the lower appellate authority has to....

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.... is made by cheque drawn by such society on its own bank account, then such a party would be entitled to avail the exemption from Excise duty, subject, however, that he produces, at the time of clearance itself, a certificate from the authorized officer of such society that yarn would be used only on handlooms. It is a matter of record that the respondent had failed to produce such certificates from the authorized officer of the society in terms of the said requirement of the Notification either at the time of clearance of the goods or even during the course of hearing of the matter before the lower authority. There is a clear finding to the effect in the order passed by the lower authority and the records nowhere disclose any material to d....

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....s case that subsequent use of the product could warrant imposition of penalty. Rather the lower authority has levied the penalty on the ground that the manufacturer has failed to comply with the precondition under the notification. The lower appellate authority totally ignoring the ground on which the penalty was imposed, and totally for extraneous reasons, proceeded to interfere with the said order and therefore the same cannot be sustained. 6. It is also seen from the records as rightly pointed out by the ld. DR that one of the consignment which was supplied to the society was of poly-viscose blended yarn having composition of 80% Polyester and 20% viscose and weighing 2,000 Kgs. valued at Rs. 2,13,260/- vide invoice No. 1710 date....