TMI Blog2015 (12) TMI 736X X X X Extracts X X X X X X X X Extracts X X X X ..... decision of this Court in Bansal Alloys and Metals Pvt. Ltd.'s case (2010 (11) TMI 83 - PUNJAB & HARYANA HIGH COURT ), the appeal filed by the revenue was dismissed. This Court in Bansal Alloys & Metals Pvt. Ltd's case (supra) while deciding the question of vires of Rules 96ZO(3), 96ZP and 96ZQ of the Rules held the said provisions to the extent of providing for mandatory minimum penalty without mens rea and without any element of discretion as excessive and unreasonable restriction on fundamental rights being arbitrary and were accordingly declared to be ultra vires the Act and the Constitution - no substantial question of law arises in this appeal - Decided against Revenue. - CEA No. 55 of 2015 (O&M) - - - Dated:- 28-11-2015 - MR. AJ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 3A of the Act. They were required to pay duty liability of ₹ 3,33,333/- per month w.e.f. 1.9.1997 in two equal installments, the first installment latest by the 15th day of each month and the second by the last day of each month, for having capacity of 2.00 Mts. of their Induction Furnace installed in the factory premises. They failed to discharge the duty liability amounting to ₹ 13,33,131/- ₹ 18,96,331/- and ₹ 15,96,107/-, respectively, during the period April, 1998 to September, 1998, October, 1998 to March, 1999 and April, 1999 to September, 1999. Accordingly, three show cause notices dated 26.10.1999, 13.10.1999 and 19.11.1999, respectively were issued to the respondent for taking penal action under Rule ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... H). Hence, the present appeal. 3. Though none has put in appearance on behalf of the appellant-revenue, however, from a perusal of the appeal, we find that the Tribunal had relied upon the decision of this Court in Bansal Alloys Metals Pvt. Ltd.'s case (supra). The issue was with regard to levy of penalty which was reduced by the Commissioner (Appeals). 4. The issue raised in this appeal stands concluded by the decision of this Court in CEA No. 49 of 2012 [M/s Jai Bharat Maruti Ltd. v. Commissioner of Central Excise Delhi-III, Vanijya Nikunj, Udyog Vihar, Phase-Gurgaon (Haryana)] decided on 12.9.2013 and CEA No. 39 of 2013 [Commissioner of Central Excise, Chandigarh-II v. M/s Pee Iron Steel Co. (P) Ltd., Derabassi] decided on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion to the extent of providing for mandatory minimum penalty without any mens rea and without any element of discretion is excessive and unreasonable restriction on fundamental rights and is arbitrary. Moreover, exercise of such power by way of subordinate legislation is not permissible when rule making authority for levying penalty is limited to default with intent to evade duty . 17. The writ petitions of the assessees are allowed and impugned provisions in Rules 96(ZO), (ZP) and (ZQ) permitting minimum penalty for delay in payment, without any discretion and without having regard to extent and circumstances for delay are held to be ultravires the Act and the Constitution. In CWP No.8555 of 2010, penalty has been sustained by the T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tine removal and intent to evade duty are present, yet the authorities are given a discretion to levy a penalty higher than ₹ 10,000/- but not exceeding the duty leviable. In a given case, therefore, even where there is willful intent to evade duty and the duty amount comes to say a crore of rupees, the authorities can in the facts and circumstances of a given case, levy a penalty of say ₹ 25,00,000/- or ₹ 50,00,000/-. This being the position, it is clear that when contrasted with the provisions of the Central Excise Act itself, the penalty provisions contained in Rules 96ZO, 96 ZP and 96 ZQ are both arbitrary and excessive. 39. A penalty can only be levied by authority of statutory law, and Section 37 of the Act, as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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