2007 (3) TMI 71

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....uance of the show cause notice?" 2. The facts necessary for the present case are that along with show cause notice for levy of duty which has not been paid notice for levy of penalty was also issued for committing breach of Rule 9(1), 52A, 53,173F, 173Q and 226 of Central Excise Rules read with Section 3 of the Additional Duties of Excise Act, 1957, Penalty was sought to be levied under Rule 9(2), 52A, 193Q and 226 of the Central Excise Rules read with Section 11AC of Central Excise Act for contravention of aforesaid provisions and ultimately finding that the duty was short levied, a penalty under Rule 9(2) read with Rule 173Q was imposed and also a penalty equivalent to the amount of tax levied was imposed with reference to Section 11AC....

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....was deposited by the manufacturer during the course of scrutiny but before issuance of the show cause notice. Penalties were imposed under Section 11AC & Rule 173Q. 7. On appeal, the Commissioner (Appeals) affirmed the short levy of duty and also the levy of penalty under Section 11AC equal to amount of Duty short levied but set aside the penalty levied under Rule 173Q in respect of very same defaults. 8. The Tribunal, however, held that in view of decision in CCE v. Gaurav Mercantiles Ltd. reported in 2005 (190) E.L.T. 11, since assessee has already deposited the amount of short levy of duty before issuance of show cause notice, no penalty was leviable and set aside the order of penalty in toto. 9. In these cases the respondents a....