TMI Blog2017 (7) TMI 886X X X X Extracts X X X X X X X X Extracts X X X X ..... ically by operation of law. Further I find that the learned Commissioner has observed that though the appellant is liable to pay the mandatory penalty under Section 11AC but since the Tribunal in the impugned order has directed him to impose nominal penalty and therefore he has only imposed a nominal penalty of ₹ 10,000/- under Section 11AC. Redemption fine - Held that: - the Tribunal has observed that there are several judgments for not imposing mandatory penalty and redemption fine in the facts and circumstances where the goods are cleared without payment of duty if bonafides are established - redemption fine dropped. Penalty - Held that: - the imposition of penalty of ₹ 10,000/- is justified. Appeal allowed - decided partly in favor of appellant. - E/272/2009-SM, E/311/2009-SM - 20935-20936/2017 - Dated:- 16-6-2017 - Shri S.S Garg, Judicial Member Shri Anirudha R.J. Nayak, Advocate, For the Appellant Dr. Harish J. Deputy Commissioner (AR), For the Respondent ORDER Per: SS GARG The present appeals one filed by the assessee and the other by the Revenue are directed against the impugned order dated 31.12.2008 wherein the learned Com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt, confirmed the demand amount of ₹ 4,68,103/- (Rupees Four Lakhs Sixty Eight Thousand One Hundred and Three only), imposed equal penalty under Section 11AC of the Act, confirmed interest, confiscated the seized goods with an option to redeem the same, confiscated the plant and machinery with an option to redeem and confirmed penalty on the employees of the company. Further aggrieved by the said order the assessee preferred an appeal before Hon'ble CESTAT, Bangalore which vide final order No.505-508/2005 dated 01.04.2005 remanded the matter to the jurisdictional Commissioner of Central Excise for de novo adjudication with a direction for quantification of Modvat credit, and imposition of mandatory penalty redemption fine and to re-work the duty liability in the light of the assessee's submissions. The Hon'ble CESTAT also directed to impose nominal penalty after considering the directions of the bench. The Tribunal has also set aside the penalty imposed on the employees of the company, Aggrieved by the Hon'ble CESTAT's direction to extend Modvat benefit to the assessee, the department filed CEA No.42/2005 before the Hon'ble High Court of Karnataka ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bmitted that the Department is due to them to the tune of ₹ 29,48,947/- (Rupees Twenty Nine Lakhs Forty Eight Thousand Nine Hundred and Forty Seven only) and after deducting the duty demand of ₹ 6.18 lakhs balance should be paid to the appellant which comes to ₹ 23,30,844/- (Rupees Twenty Three Lakhs Thirty Thousand Eight Hundred and Forty Four only). He also submitted that the interest imposed under Section 11AB is not sustainable since the Department net to net is due to pay to the appellant and vice versa. He further submitted that the bonafide of the appellant was never in question being under a bonafide belief that the items were not liable to excise duty in view of its immovability. He also submitted that the appellants are entitled to refund in cash as they were not entitled to utilize the cenvat credit on account of their factory having stopped production and surrendered its registration certificate on 28.08.2006. In support of his submissions, the appellants relied upon the following decisions: a) Toyota Kirloskar Auto Parts P. Ltd. Vs. CCE, 2012 (276) ELT 332 (Kar.) b) Union of India Vs. Slovak Trading Co. Pvt Ltd. 2006 (201) ELT 559 (Kar) an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s relied upon by the appellant are not applicable in the facts and circumstances of the case and are distinguishable. 5. After considering the submissions of both the parties and perusal of the material on record, I find that impugned order has been passed by the Commissioner after considering all the directions given by the Tribunal vide its order dated 01.04.2005. I also find that as per the direction of the Tribunal, the learned Commissioner has clarified the entitlement of modvat credit of ₹ 18,17,187/- (Rupees Eighteen Lakhs Seventeen Thousand One Hundred and Eighty Seven only) which the Commissioner is held that the appellant is entitled to the same. Further the Commissioner has also reworked the duty liability after considering the SSI exemptions and has determined the total duty payable amounting to ₹ 6,18,103/- (Rupees Six Lakhs Eighteen Thousand One Hundred and Three only). Further the learned Commissioner has held that the appellant is liable to pay interest on the duty demand as the interest liability is compensatory in character which is imposed on the assessee who has withheld the payment of any tax or duty and such liability arises automatically by ope ..... X X X X Extracts X X X X X X X X Extracts X X X X
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