2017 (2) TMI 1386

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....nfirming the levy of interest is without jurisdiction inasmuch as it fails to see that the petitioner had paid the duty even before the issuance of show cause notice ? 2.      Whether determination of duty under sub-section (2) to Section 11AC which requires a show cause notice followed by determination by the adjudicating authority is a condition precedent for invoking penalty under Section 11AC ? 3.      Whether imposition of penalty is impermissible when duty has been paid even before issuance of show cause notice inasmuch as there would be no determination under Section 11AC? 4.      Whether the impugned order passed by the first respondent which is contrary t....

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....present case. 2. (c) In further appeal before the CESTAT by the assessee and the revenue, the Tribunal confirmed the levy of interest but restored the levy of penalty. The Assessee is in appeal against the aforesaid order of the CESTAT. 3. We have heard Mr. Muthu Venkataraman, Learned Counsel assisted by Ms. Cynduja Crishnan for the appellant and Mr. T. Pramod Kumar Chopda, Learned Standing Counsel for the 2nd respondent. 4. The stand of the assessee in the present case is the duty had been remitted prior to the issuance of a demand for the same and thus, the levy of penalty in terms of Section 11AC is not warranted. Reliance has been placed by the assessee upon the provisions of Section 11AC and the proviso thereunder, bo....

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....elied upon in support of the applicability of the proviso. 6. Mr. Pramod Kumar Chopda, Learned Counsel appearing for the department would however point out that two pre-conditions exist for the application of the proviso - one, the payment of duty and the second, the payment of interest as per Section 11AB of the Act. The latter, according to him, has not been satisfied in the present case. 7. In this context, the judgments of the Supreme Court in the case of Commissioner of Central Excise, Pune v. SKF India Ltd., 2009 (239) E.L.T. 385, as well as Steel Authority of India Ltd., v. Commissioner of Central Excise, Raipur, 2015 (326) E.L.T. 450, have been brought to our attention. The judgments deal with liability to interest on di....