2013 (1) TMI 664

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....spondent. [Judgment per : D. Murugesan, J.]. - This Civil Miscellaneous Appeal is at the instance of the Revenue. While admitting the appeal, this Court has framed the following substantial questions of law : (i)      Whether the second respondent-Tribunal was correct in relying on the decision of C.C.E., Delhi-III v. Machino Montell (I) Ltd. reported in 2004 (168....

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...., Excise and Service Tax Appellate Tribunal (hereinafter referred to as "CESTAT") have held that the duty has already been paid even before the issuance of show cause notice and in that event, in view of the settled position of law, penalty cannot be levied. To arrive at such a conclusion the CESTAT had relied on a decision of the Larger Bench of the Tribunal in the case of Commissioner of Central....

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....he basis of the common though erroneous view that no penalty would be leviable if the escaped amount of duty is paid before the service of notice. It however overlooks the two explanations qualifying the main provision. Explanation 1 makes it clear that the payment would, nevertheless, be subject to imposition of interest under Section 11AB. Explanation 2 makes it further clear that in case the es....