SHREE NATH ENTERPRISES Vs. CCE

JUDGEMENT

(1.) IS appeal is directed against Order -in -Appeal dated 17.6.2002 which upheld the order -in -original imposing penalty and confiscating the packing material found excess in the appellant's factory.

(2.) THE issue involved in this case is regarding imposition of penalty under Section 11AC of the Central Excise Act on the goods which were cleared by the appellant clandestinely without payment of duty and noticed during the surprise visit of the officers. The appellants discharged the duty liability on 1.10.2002 while the show cause notice was issued on 26.3.2003 and redemption fine (sic) imposed on the appellant on the packing material which were found in excess than the recorded balance in the appellant's factory. The appellant was not able to produce duty paying documents in respect of such packing material.

(3.) CONSIDERED the submissions made by both sides and perused the record. It is the contention of the learned Consultant for the appellant that since the duty liability stands discharged before the issuance of show cause notice there cannot be any penalty on the appellant under Section 11AC of the Central Excise Act, 1944. 1 find force in the appellant's submission as regard penalty. The Hon'ble High Court of Bombay in the case of CCE v. Gaurav Mercantile as reported at on an appeal by the Revenue held as under: 3. The substantial questions of law sought to be raised are as under: