In Brief
The Department of Central Excise raised three duty demands against the respondent company: Rs. 26,94,890/-, Rs. 13,49,830/-, and Rs. 79,39,162/-. The Tribunal upheld the first two (totalling Rs. 40,44,720/-) but quashed the third. However, it reduced the penalty to Rs. 20 lakhs. The Supreme Court held that under Section 11AC of the Central Excise Act, the penalty must equal the duty so determined. Since the upheld duty was Rs. 40,44,720/-, the penalty must also be that amount. The Court partly allowed the appeal, directing the respondent to pay the correct penalty of Rs. 40,44,720/-, adjusting the Rs. 20 lakhs already paid, with the balance due in two months.
The lawyer headnote and full judgment text are available to registered users.