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enhancement of penalty equal to the amount of duty

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Court :
CESTAT-New Delhi

Brief :
For delayed payment, the appellants had also already paid the interest. Therefore, under these circumstances, the enhancement of penalty equal to the amount of duty by the Commissioner (Appeals) cannot be justified

Citation :
2005 (179) ELT 573 (Tri. - Del.) IN THE CESTAT, NORTHERN BENCH, NEW DELHI S/Shri V.K. Agrawal, Member (T) and P.S. Bajaj, Member (J) SHIVAGRICO IMPLEMENTS LTD. Versus COMMISSIONER OF CENTRAL EXCISE, JAIPUR Final Order No. 758/2004-NB(C), dated 20-10-2004 in Appeal No. E/2863/2004-NB(C)

2005 (179) ELT 573 (Tri. - Del.) IN THE CESTAT, NORTHERN BENCH, NEW DELHI S/Shri V.K. Agrawal, Member (T) and P.S. Bajaj, Member (J) SHIVAGRICO IMPLEMENTS LTD. Versus COMMISSIONER OF CENTRAL EXCISE, JAIPUR Final Order No. 758/2004-NB(C), dated 20-10-2004 in Appeal No. E/2863/2004-NB(C) Advocated By : Shri K.K. Anand, Advocate, for the Appellant. Shri D.N. Chaudhary, SDR, for the Respondent. [Order per : P.S. Bajaj, Member (J)]. - This appeal has been preferred against the impugned order-in-appeal vide which the Commissioner (Appeals) has enhanced the penalty under Rule 96ZP(3) against the appellants. 2.The learned Counsel has contended that since the  duty had already been paid along with the interest, the penalty equal to the amount of duty had been wrongly imposed by the Commissioner (Appeals) through the impugned order. 3.On the other hand, the learned SDR has stated that  the penalty imposed by the adjudicating authority was not reasonable and that the Commissioner (Appeals) has rightly enhanced the same. 4.1We have heard both the sides and gone through the  record. 4.2The facts are not much in dispute. The appellants  failed to pay full duty during the period April, 1999 to September, 1999 as determined under Section 3A read with Rule 96ZP(3) of the Rules. The total duty not paid by them was worked out to Rs. 5,23,248/- and they were served with a show cause notice for paying the same. We find that they paid this duty amount along with interest. The adjudicating authority imposed penalty of Rs. 25,000/- under Rule 96ZP(3) of the Rules on the appellants keeping in view the payment of duty already made. The Commissioner (Appeals) on an appeal filed by the Revenue against that order of the adjudicating authority, had enhanced the penalty equal to the duty amount detailed above, but he has not recorded any reasons for making this enhancement. He has lost sight of the fact that the entire differential duty had already been paid by the appellants and the non-payment of this duty was not deliberate but on account of financial hardship which they were facing during that time. For delayed payment, the appellants had also already paid the interest. Therefore, under these circumstances, the enhancement of penalty equal to the amount of duty by the Commissioner (Appeals) cannot be justified and as such, the same is reduced to Rs. 50,000/-. Except for this modification in the penalty amount, the impugned order is upheld. The appeal of the appellants accordingly stands disposed of.
 

Dayal
on 11 March 2008
Published in Excise
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