CCE Vs. KRISHNA MARUTI LTD.

JUDGEMENT

(1.) This Appeal arises from the order dated 13.07.2004 passed by the Commissioner (Appeals), Gurgaon. The Commissioner (Appeals) by the impugned order has allowed the appeal which was filed by the respondents against the imposition of the penalty. By the impugned order, the imposition of penalty to the extent of Rs. 14,80,597.50 imposed by the Deputy Commissioner, Gurgaon, under Rule 9(2), 57(l) and 173Q of the Central Excise Rules, 1944 and Section 11A of the Central Excise Act, 1944, has been set aside.

(2.) The respondents herein are engaged in the manufacture of automobile seats classifiable under chapter sub -heading 9401.00 of the Central Excise Tariff Act, 1985. They availed the facility of modvat credit under erstwhile Rule 57A and 57Q of the Central Excise Rules, 1944. The appellant issued show cause notice to the respondents on 03.05.2000 requiring them to show cause as to why the duty to the tune of Rs. 14,80,597.50, short paid on the inputs cleared under Rule 57F(2) and 57F(3) should not be demanded and recovered under Rule 57I and 9(2) of the said Rules read with Section 11A of the said Act and short paid duty, already debited, should not be appropriated and penalty should not be imposed under Rule 9(2), 57(l) and 173Q of the said Rules. After hearing the respondents, the Deputy Commissioner, Gurgaon, by order dated 16.06.2000 imposed penalty, as stated above, along with confirming the demand for short paid duty to the tune of Rs. 14,80,597.50. The matter was carried in appeal by the respondents whereupon the Commissioner (Appeals), relying upon the decision of this Tribunal in the case of CCE, Delhi -III (Gurgaon) v. Machino Montell (I) Ltd. reported in, 2004 (62) RLT 709 (CESTAT -LB), held that no penalty could have been imposed under Section 11AC and no interest could have been demanded under Section 11AB when the duty demanded has already been paid by the assessee before the issuance of show cause notice and, therefore, set aside the penalty imposed by the Deputy Commissioner, Gurgaon. It is against this order, the appellant has come before this Tribunal.

(3.) On the other hand, learned advocate appearing for the respondent submitted that, there was delay only of 12 to 15 days in depositing the duty amount and that too on account of confusion which prevailed at the relevant time regarding the quantification of the duty and immediately upon clarification, in that regard, the duty was deposited. There was no intention to evade the payment of duty. Being so, the authority below has taken a reasonable view in the matter and in the facts and circumstances of the case, it cannot be said that he acted arbitrarily in setting aside the penalty. In fact, according to the learned advocate for the respondents, it discloses fair justice to the parties and, therefore, it does not call for any interference.