2017 (2) TMI 1069

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.... 2. Briefly stated the facts of the case are that the appellants-assessees are engaged in the manufacture of excisable goods viz. Cotton Ginning Machineries falling under Chapter 84, 85 of CETA, 1985. Alleging that they had cleared the said goods wrongly availing the benefit of Notification at NIL rate, show Cause Notices were issued to them for recovery of duty of Rs. 36,38,679/- and proposal for penalty under Section 11AC of Central Excise Act, 1944, personal penalty on the Director under Rule 26 of Central Excise Rules, 2002. On adjudication, the demand was confirmed with interest and equal amount of penalty on the appellant company and personal penalty of Rs. 15,00,000/- on the Director under Rule 26 of Central Excise Rules, 2002. Aggr....

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....the appellant company and personal penalty under Rule 26 of Central Excise Rules,2002 on the Director is unjustified. The Ld. Advocate for the Appellants submits that the appellant under a bonafide belief, cleared the goods at NIL rate of duty and major portion of the demand relates to their trading sales. It is his contention that the demand confirmed initially was reduced to Rs. 3,92,051/- after extending the benefit of cum-duty-price as well as production of purchase invoices relatable to trading sales. It is his submission that where ever they could not establish the trading activity by production of purchase invoices, duty was confirmed. It is contention that there was no malafide intention to evade payment of duty as all the sales dur....

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....ssesses are: whether the penalty on the appellant company imposed under Section 11AC of Central Excise Act, 1944, and personal penalty under Rule 26 of Central Excise Rules,2002 on the Director are sustainable or otherwise. The Revenue is in Appeal challenging the benefit of discharging 25% of the penalty imposed under Sec.11AC, subject to fulfilment condition by the assessee, extended by the Ld. Commissioner(Appeals) in the impugned Order. 7. I find that even though initially the demand for recovery of duty was Rs. 36,38,679/- through show cause notice dated 09.08.2005, but in the second round of litigation, before the Adjudicating Authority, it was reduced to 32,07,982/- and later drastically reduced by the Ld. Commissioner (Appeals) to ....