TMI Blog2009 (12) TMI 489X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, 1944 is maximum and authority has discretion to impose lesser penalty?" 2 Brief facts of the case, as disclosed m the appeal, are that the respondent assessee is engaged in the manufacturing of Cold Rold Strips and Steel Tubes falling under Chapter Heading Nos. 72.11 73.06 of the Schedule to the Central Excise Tariff Act, 1985. The respondent-assessee was also availing the Cenvat credit facility of duty paid on raw material/puts and capital goods On 23/24-11-2000, the Officers of Central Excise Rohtak Division intercepted a tempo on Delhi-Rohtak Highway, bearing Registration No. HR-46-A-3040, be longing to the respondent-assessee, which was loaded with steel tubes and pipes. On demand the driver produced original copy of invoice bearing Sr. No. 1714, dated 23-11-2000, valued at Rs. 1,02,765/- involving Central Excise duty of Rs.16,442/-, issued by the respondent-assessee. However, the transporter's copy of the invoice was not available. 3. The officers brought back the tempo to the factory premises, where Shri A.N. Singh, authorised signatory of the respondent-assessee was present. Thereafter, in the presence of two independent witnesses the records pertaining to central ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1A of the Central Excise Act, 1944. (b) Seized Steel Tubes/Pipes weighing 6.045 MT valued at Rs. 102,765 and Cit Strips weighing 5.210 MT valued at Rs. 10,2,403/- should not be confiscated and penalty imposed on them under Rules 9(2) and 173Q of the Central Excise Rules, 1944. (c) Tempo No. HR-46A-403t) valued at Rs. 20,0,000/- should not be confiscated under Section 115 of Customs Act, 1962 made applicable to central excise matters. (d) Mandatory penalty should not be imposed and interest on delayed payment of Central Excise Duty should not be recovered from them under Sections l 11AC of the Central Excise Ad, 1944." 5. The case was adjudicated by the Joint Commissioner who vide order dated 26-2-2003 confirmed the demand of duty of Es. 40,218/- covered by three invoices dated 23-11-2000. The seized goods i.e. 6.045 MT steel tubes/pipes valued at Rs. 1,02,765/- 5.210 MT C.R. Strips valued at Rs. 1,02,403/- were confiscated with an option of redemption fine of Rs. 10,000/- for each of them. Penalty of Rs. 40,218/- under Section 1 and recovery of interest under Section 11AC of the Act has also been imposed upon the respondent-assessee. Other than this, the tempo valued a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y accounted for in the record. It has been specifically noticed by the Tribunal that these goods were purchased under duty paid invoices and the same were utilised in the manufacture of final product. The Tribunal also reduced the penalty to Rs. 2,000/-. 8. Having heard learned counsel for the parties and perusing the re cord with their able assistance we find that the matter is no longer res integra. In the present case it would be necessary to read Rule 13 of the Central Excise Rules, 1944 (sic) (for brevity, "the Rules'), which reads thus: "13. Confiscation and penalty.- (1) If any person, takes CENVAT credit in respect of inputs or capital goods, wrongly or without taking reasonable steps to ensure that appropriate duty on the said inputs or capital goods has been paid as indicated in the document accompanying the inputs or capital goods specified in rule 7, or contravenes any of the provisions of these rules in respect of any inputs or capital goods, then, all such goods shall be liable to confiscation and such person, shall be liable to a penalty not exceeding the duty on the excigable goods in respect of which any contravention has been committed or ten thousand rupees, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... penalty is imposable or not, the requirements of Section 11AC have to be fulfilled. It has been held in para 19 of the judgment that 'penalty under Section 11AC as the word suggests, is punishment for an act of deliberate deception by the assessee with the intent to evade duty by adopting any of the means mentioned in the section'. Accordingly, the judgment of Hon'b the Supreme Court in -Dharaniendra Textile Processor's case (supra) is not an authority for the proposition that Section 11AC of the Act would apply to every case of non payment or short payment of duty regardless of fulfilment of the conditions expressly mentioned in the section for its application. However, once it was found to be applicable then the concerned authorities would have no discretion in quantifying the amount and penalty must be imposed equal to the duty determined under Section 11(2) of the Act. 11. In the present case, learned counsel for the appellant has not been able to show any fraud, wilful misstatement, collusion or suppression of facts on the part of the respondent-assessee with the intention to evade payment of duty. We confronted learned counsel for the revenue to point out any finding of ava ..... X X X X Extracts X X X X X X X X Extracts X X X X
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