2011 (5) TMI 603

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.... duty of Rs.1,50,034/- was detected. Shri R.N.Gupta, authorized signatory of the respondent, present on the spot, admitted the shortage and his statement was recorded at that time, wherein he stated that the shortage may be due to removal of the goods by the factory staff in his absence. The duty on the goods found short - Rs.1,50,034/- was deposited on 17.05.07 and the respondent requested that their case may be considered for closure under section 11A(2B) of the Central Excise Act. The department, however, treating this case as the case of clandestinely removal, issued a show cause notice for confirmation of the duty demand and imposition of penalty under section 11AC on the respondent company and under Rule 26 of Central Excise Rules, 20....

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..... The department subsequently issued a show cause notice for confirmation of the duty demand and imposition of penalty on the respondent and their authorised signatory. Assistant Commissioner, vide Order-In-Original dated 19.01.09 confirmed the duty demand on the shortage of glassware, the amount paid by the respondent was appropriated and besides this while penalty of equal amount, i.e., Rs.1,54,559/- was imposed on M/s Sun Glass Works P.Ltd., penalty f Rs.10,000/- was imposed on Shri Kokamal, authorized signatory. Commissioner (Appeals), however, while upholding the duty demand, set aside the penalty on the respondent company and their authorised signatory against which the department is in appeal. The respondents have filed Cross Objecti....

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....cited the judgement of Hon ble Delhi High Court in the case of K.P.Pouches vs. Union of India reported in 2008(228)/ELT-31(Delhi) and pleaded that since the duty has been paid before the issue of show cause notice and inspite of this, no option to pay reduced penalty within the period of 30 days from the date of communication of adjudication order has been given in the adjudication order, the reduced penalty under the proviso of section 11AC cannot be denied and therefore, in any case, the penalty imposable would be 25% of the duty demand.   5. Shri P.Ram, representing M/s Sun Glass Works also defended the impugned order by reiterating the findings of the Commissioner(Appeals) s order and pleaded that since the duty has been paid befo....