2009 (6) TMI 87

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.... 1999. One of the penalties sought to be imposed on the respondent herein was under Rule 57-I(4) of the Central Excise Rules, 1944. Respondents showed cause. The Assessing Officer thereafter by his order was pleased to confirm the duty in the sum of Rs. 1,30,510/-on raw materials and some other finished goods and also ordered for appropriation of Rs. 2,950/-. The A.O. has imposed penalty of Rs. 1,30,510/- on the assessee under Rule 57-I(4) of the Rules. 3. The Respondent aggrieved preferred an appeal before the Commissioner (Appeals) of Central Excise and Customs. By order dated 20th March, 2001 the learned Appellate Authority in para 6 was pleased to hold that the A.O. was right in confirming the demand of duty and imposition of penalty f....

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.... such increased or further increased, amount of credit disallowed." From the plain or literal reading of the said sub-rule it would be clear that the language used is "shall". Apart from that if we consider the two explanations to the said sub-rule in the event credit is disallowed or reduced the penalty payable is on such reduced amount of credit disallowed. In other words by operation of law itself the amount of penalty has to be equivalent to the amount of duty. If we construe these two explanations and mandatory language used in sub-rule (4) there is no manner of doubt that the language is mandatory and there is no discretion in the authorities in the matter of imposition of penalty. The penalty has to be equal to the amount of duty wh....

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....he ingredients of Section 11AC are not satisfied then no penalty can be imposed. Similarly Rule 57-I(4) must be so construed. In the instant case the learned Tribunal had not addressed itself, to this issue. On this finding itself ordinarily we ought to have remanded the matter back to the Tribunal for reconsideration. However, in our opinion, such an exercise would only result in waste of the judicial time. We had an occasion to peruse the findings of the Commissioner (Appeals). We find that the Commissioner (Appeals) has also not addressed the issue as to whether the penalty is imposable on account of fraud, willful misstatement, collusion or suppression of facts or contravention of any other provisions of the Act or Rules made thereunder....