TMI Blog2018 (3) TMI 1546X X X X Extracts X X X X X X X X Extracts X X X X ..... , 1944, as amended vide Finance Act, 2015, which was passed on 14-15/05/2015. 2. The brief facts of the case are that the respondent's unit is located at SEZ Phase II, Pharma Zone, Pithampur and another unit at 385/2 Pigdambar, Rau, Indore and are engaged in manufacture of Active Pharmaceutical Ingredients (cortico Steroids). They are registered with the Department. A consignment of waste (invoice NO.2777 dt.19.7.14) was intercepted and seized by the Preventive officers of Central Excise Hqrs. Indore on the allegation that the invoice covering the consignment was showing process waste/scrap whereas the goods were high valued pharmaceutical ingredients valued at ₹ 2,60,24,448/- which should have suffered duty of ₹ 32,16,662/-. Subsequently search at the factory premises resulted into detection of excess of stock valued at ₹ 1,21,005/- and both these goods (where duty was allegedly short paid, and goods found in excess) were seized alongwith vehicle used for transportation of goods (on which duty was short paid). Further, there was some shortage detected in the factory of dutiable ₹ 7,03,055/-, on which duty applicable is ₹ 86,914/-. 3. The a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cated goods and ₹ 50,000/- on the vehicle alongwith also an additional penalty of ₹ 5,00,000/- was imposed which was not at all warranted as per the provisions of the amended Section 11AC. 10. It is observed that the Adjudicating Authority had unambiguously held that the provisions of amended Section 11AC is applicable in the appellant's case and if it is so the proceedings initiated against the appellant should have been closed and there was no necessary to impose further penalties on the appellant as has been done in this case. According to the amended Section 11AC of the act wherever the duty demand is involved and the assessee is making payment of said demand alongwith interest and also a penalty of 15% of the duty demand, before the adjudication of the show cause notice, then the proceedings against the said assessee should be deemed as closed. It means that even if a adjudication order to show the disposal of the show cause notice, needs to be issued, the adjudicating authority has got no right to further impose any penalty other than 15% of the penalty envisaged in the said Section, already paid by the assessee. In the present case, the duty demand of &# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the required penalty of 15% of the duty demanded, is paid by the appellant within the stipulated time frame as prescribed in the said legal provisions of the Section. Therefore, the proceedings against the appellant in respect of such demand should be treated as closed and the additional redemption fine and penalty imposed in respect of such goods where a demand of duty is already raised and paid alongwith applicable penalty of 15%, is not legally warranted. There is another plea of the appellant that though they had paid duty on the goods intercepted in transportation, which was later confiscated also, had been taken back to the factory. It is their plea that since the duty paid goods had been brought back to the factory, the duty paid on the same may be allowed as credit so that when the same is removed again, it is not subjected to double duty, Considering the particular circumstances in which the duty paid goods are brought back to factory and also to avoid double taxation, the appellant is allowed to take credit of the duty applicable/paid only on the returned goods with the condition that they should follow the procedure of accounting and further payment of duty on removal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be deemed to be concluded, if the duty, interest and penalty are paid within the stipulated time. The same shall not apply to the proposal in the show cause notice as regards proposed confiscation of the goods and vehicle. In case a show cause notice requires to adjust two issues namely non-payment of duty and seizure of goods and vehicle and the assessee/notice paid duty involved alongwith interest and penalty within stipulated time frame then according to provisions of Section 11AC only proceedings related to non-payment of duty would be concluded. Further, proceedings in respect of seizure/confiscation of goods and vehicle are required to be concluded separately. Further redemption fine and penalty cannot be treated as one and the same. The learned AR also relies on the ruling in the case of CCE, CUS ST Vs. Steel Engineering Co. in CEA Defective No.32 of 2014 being order dated 07/03/2014 of Hon'ble Allahabad High Court and in the case of Hon'ble Supreme Court in M.P. Agencies Vs. State of Kerala - 2015 (318) E.L..T 22 (S.C.) and Larger Bench of this Tribunal in Copper Rollers Pvt. Ltd., Bombay Vs. CCE, Bombay - 1983 (13) 981 (CEGAT). 8. The learned C ..... 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