TMI Blog2014 (1) TMI 1212X X X X Extracts X X X X X X X X Extracts X X X X ..... and further clarified in the case of Union of India Vs. Rajasthan Spinning & Weaving Mills reported in (2009 (5) TMI 15 - SUPREME COURT OF INDIA) - Decided in favour of Revenue. - Taxation Case No. 3 of 2004 - - - Dated:- 8-1-2014 - R. Banumathi, C.J And Aparesh Kumar Singh,JJ. For the Petitioner : M/s. Ratnesh Kumar, Amit Kumar For the Respondent : Mr. Ashok Kumar Sinha ORDER R. Banumathi,C. J. This application is preferred against the order of the Customs, Excise Gold (Control) Appellate Tribunal(CEGAT) dated 28.10.2002 passed in Appeal No.ER 307/2001, by which CEGAT reduced the penalty amount imposed under rule 96ZO(3) from Rs.83,87,000/- to Rs.40,00,000/-. 2. The respondent-assessee is the manufacturer of M.S Ingot/Billets falling under chapter, sub-heading 7206.90 of Schedule to CETA, 1985. The said goods were notified for the purpose of levy of duty of excise under the provisions of section 3A of Central Excise Act, 1944, based on Annual Capacity of Production (ACP) in the manner as prescribed under the provision of Rule 96ZO of Central Excise Rules (CER). Sub-rule 1 of Rule 3 of the Induction Furnace Annual Capacity Determination Rules, 1997 specif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r, the Commissioner imposed penalty of an identical amount of Rs.83,87,097/- under Rule 96ZO(3) of the CER 44 and directed to verify the payment particulars to determine the amount of interest @ 18% per annum. 6. Being aggrieved by the Order-in-Original No.93-96 97/Commissioner/2000 dated 24.11.2000, the assessee preferred appeals before the CEGAT in Appeals ER-306-308/2001. The CEGAT, by the order dated 19.12.2001, directed the assessee to deposit an amount of Rs.25,00,000/- (Rs.twenty-five lakhs). Since the respondent-assessee has not deposited the amount, the CEGAT, by the order dated 22.2.2002, dismissed all three appeals. 7. Again Appeal Nos.ER-306-307/2001 were taken up by the CEGAT. By the order dated 28.10.2002, in each of the appeals (ER-306-307/2001), the CEGAT reduced the penalty amount from Rs.83,87,000/- to Rs.40,00,000/-, holding as under:- 5. After hearing both the sides we find that it is now well settled that the mandatory penalty to the extent of 100% under a particular provision is the maximum penalty provided under the law, for which adequate reasons should be given by the authorities. In the instant case we take note of the appellant s plea that the du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... presently holding field. Learned counsel also submitted that earlier dismissal of Tax Case No.5/2003 (against Appeal No.ER-306/2001) would not preclude this Court from considering the question afresh. 10. We have also heard learned counsel appearing for the respondent-assessee. Learned counsel for the assessee submitted that after the impugned judgment passed by this Court in W.P(T) No.5528/2003 (2.11.2007), the assessee moved Hon ble Supreme Court in Civil Appeal No.8410 of 2009 and the Hon ble Supreme Court disposed of the same, holding that the matters are covered by the judgment rendered in the case of Dharamendra Textile Processors Ors. reported in (2008) 13 SCC 369 and giving liberty to the assessee(s) to challenge the validity of Rule 96ZO before the High Court. Learned counsel further submitted that earlier the matter has attained finality and the issue involved in the present Tax Case is a covered matter and therefore, the instant Tax Case is liable to be dismissed. 11. We have carefully considered the submissions and also the common order passed by the Division Bench of this Court in Tax Case Nos.5 and 7 of 2003 and W.P(T) No.5528/2003. 12. In the case of Dharamen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lea that Rules 96-ZQ and 96-ZO have a concept of discretion inbuilt cannot be sustained. Dilip Shroff case was not correctly decided but SEBI case has analysed the legal position in the correct prospective. The reference is answered. ... 14. The decision rendered in the case of Dharamendra Textile Processors Ors. was further clarified in the decision rendered in the case of Union of India Vs. Rajasthan Spinning Weaving Mills reported in (2009) 13 SCC 448. Considering the discretion of the authority in levying penalty under section 11AC, and observing that section 11AC does not apply to every case of non-payment or short-payment of duty regardless of conditions expressly mentioned in section 11AC for its application, Hon ble Supreme Court held as under:- 30. At this stage, we need to examine the recent decision of this Court in Dharamendra Textile. In almost every case relating to penalty, the decision is referred to on behalf of the Revenue as if it laid down that in every case of non-payment or short-payment of duty the penalty clause would automatically get attracted and the Authority had no discretion in the matter. One of us (Aftab Alam, J.) was a party to the decisio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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