COMMISSIONER OF CENTRAL EXCISE Vs. MADRAS DIAMOND TOOLS

JUDGEMENT

(1.) Revenue is aggrieved with the order of the Commissioner (Appeals) modifying the terms of the Order -in -Original inasmuch as he has given direction to the lower authority to grant the benefit of modvat credit as well as the benefit available under Section 4(4)(d)(ii) of the CE Act. He has not reduced the mandatory penalty imposed under Section 11AC which was fixed at Rs. 1,81,985. However the penalty imposed under Rule 173Q has been reduced from Rs. 1.00 lakh to Rs. 5,000. The Commissioner (Appeals) has given reasons for reducing the penalty to Rs. 5,000 under Rule 173Q.

(2.) The revenue is aggrieved with this portion of the order and contend that the penalty under Rule 173Q ought not to have been reduced in view of the clear evasion of duty and the intention to evade duty having been brought out and the offence has been recorded in Order -in -original are of serious and deliberate nature. It is stated that the Commissioner (Appeals) has not brought out any justification for reducing the penalty under Rule 173Q. It is stated that the original authority after careful verification of the offence committed by the assessee deemed it a fit case for imposing penalty under Rule 173Q and that the Commissioner (Appeals) seeks to reduce the same and the law of equity beholds on the part of Commissioner (Appeals) to record proper justification for scaling it down.

(3.) I have heard DR Shri C. Mani who submits that for the reasons stated in the appeal, the Order -in -original should be restored.