CESTAT, Larger Bench's decision in the case of Commissioner of Central Excise, Delhi IV v. ILPEA Paramount Pvt. Ltd. [2007 (213) E.L.T. 500 (Tri.-LB)]

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....stoms Act, 1962 in a situation when warranted has been engaging attention of the Board for quite some time. In several judgments/decisions rendered by various Tribunals/Court a view have been taken that the penalty imposable under Section 11AC of the Central Excise Act or Section 114A of the Customs Act mandate a maximum limit of penalty which is imposable as a consequence the adjudicating/appellate authorities are vested with the powers of discretion. In a recent judgment the Hon'ble Larger Bench of the CESTAT vide their Final Order No. 278/2007-CX dated 21st June, 2007 in the case of Commissioner of Central Excise, Delhi-IV v. ILPEA Paramount Pvt. Ltd., in remand proceedings (as directed by the Hon'ble Punjab & Haryana High Court) have....

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....eld to be arbitrary in any manner." (Para 20) In the remand proceedings, the Tribunal not only restored the original order imposing the penalty equal to the amount of duty confirmed. It further held that prior to amendment (dated 12-5-2000) Section 11AC left no scope for any discretion as regards quantum of penalty imposable. It has been held by the Larger Bench of the Tribunal that - Para 14.1 ".....When the ingredients laid down in the proviso of Section 11A(1) for invoking the extended period of limitation and in Section 11AC for imposition of penalty are identical, in a case where these ingredients are satisfied for invoking the extended period of limitation, that very finding will enure for the purpose of imposing penalty under S....