TaxTMI 
TaxTMI 
2014 (5) TMI 250
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....n following the attendant Central Excise formalities. The officials of the respondent conducted search of the premises of the assessee. The statement of various authorized persons was recorded. Based on the said investigation, a show cause notice was issued proposing to demand an amount of Rs.81,60,716/- on various grounds. The assessee filed its reply rebutting and denying all the allegations in the show cause notice. The Commissioner of Central Excise by order-in-original No.05/2003 BNG-II dated 31.03.2003, confirmed the duty demand to the extent of Rs.46,00,500/- out of the total demand of Rs.81,60,716/- as proposed in the show cause notice. He also demanded interest and imposed penalties on the above said confirmation of duty payment. Further, a personal penalty of Rs.2,00,000/- was also imposed on the managing director of the assessee company. Aggrieved by the same, the assessee and the managing director preferred appeals. The Tribunal allowed the appeals and remitted the matter back to the adjudicating authority to examine the issue afresh and pass appropriate order. After remand, the adjudicating authority rejected the submissions of the assessee and again confirmed the duty....
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....titled to the said benefit and the same is not considered by the Tribunal. 4. Per contra, learned Counsel appearing for the revenue submitted that the penalty has not been paid in 30 days. It is paid in instalment and therefore, the assessee is not having the benefit of the said proviso and no case for interference is made out. Therefore, the substantial questions of law that arises for our consideration are as under:- "1. Whether the assessee is not entitled to the benefit of the proviso of Section 11AC of the Act, if the payment of penalty as determined is paid within the time stipulated therein? 2. Whether the assessee is not entitled to adjustment of excess tax paid towards liability of reduced penalty?" 5. The Apex Court in the case of Dharamendra Textiles Processors (supra), interpreting Sections 11A and 11AC of the Act, has held that the penalty is a civil liability. Wilful concealment is not an essential ingredient for attracting the civil liability as is the case of prosecution under Section, 276C of the Act. The provision levying penalty is....
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....der Section 11A(2) of the Act by the Central Excise Officer is paid within thirty days then penalty equal to the amount of duty is not required to be paid and the amount contemplated in lieu of the penalty is 25% of the total amount of excise duty determined the officer concerned. 9. It would further be necessary to notice that 3rd proviso takes care of a situation where duty determined to be payable is reduced or increased by the Commissioner (Appeals), Appellate Tribunal or by this Court then duty as reduced or increased is required to be taken into account. The provision takes care of fluctuation in the assessment of duty at the appellate stage. However, in the present case there is no increase or decrease in the assessment of duty of excise. The alteration has been ordered by the Tribunal in the order of the Commissioner (Appeals) by reducing the amount of penalty to 25% of the total amount of duty of excise assessed by the Assessing Authority. Therefore, we are of the view that the appeal filed by the Revenue is liable to be rejected." They have also observed at para 15, that when the judgment of the Apex Court in Dharamendra's case, was pressed into service with the....
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....y declared that in a case where a notice has been served under sub-section (4) of section 11A and subsequent to issue of such notice, the Central Excise Officer is of the opinion that the transactions in respect of which notice was issued have been recorded in specified records and the case falls under sub-section (5), penalty equal to fifty per cent of the duty shall be leviable. (2) Where the amount as modified by the appellate authority or tribunal or court is more than the amount determined under subsection (10) of section 11A by the Central Excise Officer, the time within which the interest or penalty is payable under this Act shall be counted from the date of the order of the appellate authority or tribunal or court in respect of such increased amount." In fact, subsequently by Finance Act, 2011, the earlier Section 11AC has been substituted by the new section. The difference is that the benefit given to an assessee in the proviso is now made as a part of the main section. 7. From the aforesaid provisions, it is clear that non-payment of duty attracts interest and equal amount of penalty. But if there is prompt payment of duty and interest, within the time prescribed....