TMI Blog2011 (9) TMI 541X X X X Extracts X X X X X X X X Extracts X X X X ..... ngh, Advocates RAJIV SHAKDHER, J 1. The captioned appeal was admitted on 09.05.2006 whereby the following questions of law were formulated for determination by the court: (i) Whether the amount of penalty leviable under Section 11-AC of the Central Excise Act, 1944 can be reduced even in cases where evasion of duty is established. (ii) If answer to Question No. (i) is in the affirmative whether the authority reducing the amount of penalty is duty bound to record reasons for such reduction. 2. Briefly, the facts obtaining in the case are as follows: On 22.01.2001 the revenue received intelligence that the respondent was engaged in manufacture and clearance of Raj Ratan Qiwam falling under chapter heading No. 2404.40 of the sch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontell (I) Ltd. 2004 (168) ELT 466. 6. Before us submissions were made on behalf of revenue by Mr Satish Kumar, Sr. Standing Counsel, while on behalf of respondent arguments were addressed by Mr P. Bashista. Mr. Satish Kumar submitted that the question of law ought to be answered in favour of the revenue in view of the decision of this court taken in the Commissioner of Central Excise vs Kandhari Radio Corporation passed in CEAC No. 6/2007 on 26.09.2011. Mr Satish Kumar submitted that in view of the fact that the Tribunal had confirmed the demand of duty under the provisions of Section 11AC of the Central Excise Act, 1944 there was no discretion available, in directing, as had been done by the Tribunal that, penalty be not levied. 7. On ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It is quite obvious that the respondent paid the duty after the evasion was unraveled. The payment of duty was made after the raid. The payment of duty was no voluntary act of the respondent. We may observe even otherwise this issue is no longer res integra. The Supreme Court in the case of UOI vs Rajasthan Spinning Weaving Mills (2009) 13 SCC 448 has held that payment of duty whether made, before or after the issuance of show cause notice is not an aspect which ought to be factored in by an authority seeking to impose penalty under Section 11AC. The court has also gone on to explain its own judgment in the case of UOI vs Dharmendra Textile Processors 2008 (231) E.L.T. 3(SC) by holding that once it is noticed that the conditions provided ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quantifying the amount and penalty must be imposed equal to the duty determined under sub-section (2) of Section 11A. That is what Dharmendra Textile decides. It must, however, be made clear that what is stated above in regard to the decision in Dharmendra Textile is only insofar as Section 11AC is concerned. We make no observations (as a matter of fact there is no occasion for it) with regard to the several other statutory provisions that came up for consideration in that decision (emphasis is ours) 10. The present case is one of evasion of duty. There were no arguments advanced before the Tribunal that the conditions prescribed under Section 11AC were not fulfilled. We had taken a similar view in the case of Kandhari Radio Corporatio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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