2012 (12) TMI 1003

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....R). 3. By the impugned order, the appeal filed by the Revenue was dismissed by the Tribunal. 4. So the short question that arises for consideration in this appeal is whether the Tribunal was justified in dismissing the appeal filed by the Revenue? 5. The short question involved in this appeal is whether the Tribunal was justified in upholding of the setting aside of the penalty order imposed on the assessee of Rs. 64,689/- under Section 11AC of the Act. 6. It is apposite to reproduce the entire order passed by the Tribunal to appreciate the issue involved in the case, which reads as under :- "        xxx        xxxx   &em....

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....ic/provision to Section 11A will vitiate the show cause notice for purpose of imposition of penalty under Section 11AC of Central Excise Act, 1944? 4. Factual matrix reveals that the show cause notice was issued on 19-4-2002 whereas entire amount of duty and penalty was paid on 31-1-2001 and 1-9-2001. It is thus clear that the entire duty liability was paid prior to the issuance of show cause notice. 5. Learned counsel appearing for the Respondent-assessee tried to support the order of the Tribunal on the basis of two judgments; one of the Madras High Court in the case of CCE, Madras v. Jkon Engineering (P) Ltd., 2005 (67) RLT 157 (Mad.) and another from the Karnataka High Court in the case of Commissioner of C.Ex., Mangalore ....

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....however set aside by the Commissioner (Appeals) in an appeal filed by assessee and the same was upheld by the Tribunal by dismissing the Revenue's appeal essentially on the ground that the entire amount of the duty had already been deposited by the assessee prior to issuance of impugned show cause notice demanding penalty amount from the assessee. The Tribunal placed reliance upon the two decisions of Madras and Karnataka High Courts reported in 2005 (67) RLT 157 (Mad.) CCE, Madras v. Jkon Engineering (P) Ltd., and 2004 (165) E.L.T. 508 (Kar.) Commissioner of C.Ex., Mangalore v. Shree Krishna Pipe Industries, and then came to this conclusion holding that since the entire duty has been deposited much prior to the show cause notice by the ass....