TaxTMI 
TaxTMI 
2011 (9) TMI 128
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....application is allowed. 2. Application stands disposed of. CEAC No. 16/2006 3. The captioned appeal has been filed by the revenue against the judgment of the Customs, Excise and Service Tax Appellate Tribunal (in short „Tribunal‟) dated 01.12.2005. The appeal had been admitted on 10.05.2006 by a division bench of this court. By the said order following questions of law were framed for adjudication: (i) Whether CESTAT was right in law in reducing the penalty leviable under Section 11AC of the Central Excise Act, 1944, even when evasion of duty by the unit had been established? (ii) In case answer to question no. (i) is in the affirmative whether the CESTAT was required to give reasons in support of the order of reduction. (....
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....behalf of the assessee even today. It is in these circumstances, we have proceeded to decide the questions of law framed. 6. In order to adjudicate upon the questions framed, following facts are required to be noticed. The assessee at the relevant time was engaged in the business of manufacture of car stereos under the brand name "Pioneer" falling under chapter 89 of the Central Excise Tariff Act, 1985. Evidently, the manufacturing activity was carried on by the assessee without obtaining the necessary central excise registration. The assessee thus cleared the stereos without payment of central excise duty. 7. On 16.03.2001, the officers of the central excise preventive division-IV, Delhi raided the premises of the assessee. At the ti....
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.... of the C.E. Act. 9. After giving opportunity to the assessee, by an order dated 31.07.2003 the Commissioner of Central Excise passed an adjudication order. By virtue of the said order the assessee was called upon to pay not only the central excise duty in the sum of Rs 21,19,735/- but also in addition penalty equivalent to the duty imposed. In so far as the proprietor Mr Rukam Singh was concerned a penalty in the sum of Rs 5,00,000/-, under Rule 209A of the Central Excise Rules, 1944 read with Section 38A of the C.E. Act, was imposed. 10. Aggrieved by the aforementioned order, two appeals were preferred with the Tribunal. The Tribunal by the impugned judgment sustained the duty on the ground that the goods in question were not eligib....
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....rt of the submission made on behalf of the revenue is concerned, we had considered the issue in our judgment passed on 01.09.2011 in CEAC No. 20/2006 titled Commissioner of Central Excise, Delhi -I Vs. Radhika Containers Pvt. Ltd. In the said judgment we observed as follows: "....6. We have heard the learned counsel for the revenue. In our view the matter is no longer res integra. The view taken by the Supreme Court in the aforementioned judgment (i.e., Sony India Ltd.) has also been considered, and has found resonance in the Division Bench judgment of the Bombay High Court in Godavari Manar Sahakari (supra). In that case the Bombay High Court specifically considered a contrary view taken by the Division Bench in so far as the quantifica....
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....roneous to say that penalty under Section 11AC is a sort of penal provision and, therefore, the said provision is harsh and stringent. The person, who deliberately evades the duty, is required to pay penalty equivalent to the amount of duty determined as evaded by fraud, collusion etc. 10. We, therefore, accept the submission of learned Assistant Solicitor General that under Section 11AC, there is no discretion left with the authority to impose any different quantum of penalty." 7. We are in respectful agreement with the view taken. We had taken a similar view in Poonam Sparks (supra) case based on the view of the Supreme Court in Dharmendra Textile (supra)....." 14. In consonance with what is observed in the said judgment, the ....