COMMISSIONER OF CENTRAL EXCISE Vs. ALPHA EXPORTS

JUDGEMENT

(1.) IN this appeal of the department, the short question to be considered is whether there can be a penalty on the respondent under Section 11AC of the Central Excise Act on the facts of this case.

(2.) I have heard the learned SDR. There is no representation for the respondent despite notice, nor any request of theirs for adjournment. The issue being covered by a decision of the apex court, I am inclined to dispose of this appeal finally.

(3.) THE original authority found suppression of diversion of goods by the assessee with intent to evade payment of duty. The appellate authority, in its order, did not at all deal with this aspect. Apparently, the finding of suppression, recorded against the assessee by the original authority, remains untouched. Hence I have got to proceed on this basis. In the case of UOI v. Rajasthan Spinning & Weaving Mills : 2009 (238) ELT 3 (SC) cited by the SDR, the Hon'ble Supreme Court held that payment of duty, whether before or after the show -cause notice, should not alter the liability for penalty, the conditions for which were clearly spelt out in Section 11AC of the Central Excise Act. Suppression of facts is one of the conditions spelt out in Section 11AC for a penalty equal to duty. This penalty cannot be resisted on the ground that the duty with interest thereon was paid prior to issuance of the show -cause notice. In the result, the impugned order is set aside insofar as the penal liability of the respondent is concerned and the penalty imposed on them by the original authority is restored. The appeal stands allowed.