Full Judgment
2. The plea made in the appeal memorandum is that for imposition of penalty, there need not be any culpability but that mere non-compliance with the dictate of the rule would invite penalty. It is urged that the reduction in the penalty is not warranted.
3. We find that the ld. Commissioner has given elaborate reasonings for coming to the conclusion that the quantum of penalty required reduction. The entire logic of the ld. Commissioner in his order made it clear as follows :Director of Enforcement v. MCT-M-Corpomtion Ltd., 1996 (12) RLT 365 (S.C.) has held that the officers of the Enforcement Directorate and other Administrative authorities "perform quasi-judicial functions and do not act as courts but only as administrators and adjudicators. In the proceedings before them, they do not try 'the accused for commission of any crime' (not merely an offence) but determine the liability of the contravener for the breach of his obligations imposed under the Act. They impose penalty for the breach of the civil obligations laid down under the Act and not impose sentence for the commission of offence". The Supreme Court further held that "it is thus the breach of a civil obligation which attracts penalty under Section 23(1 )(a) FERA, 1947 and finding that the delinquent has contravened the provisions of Section 10-FERA 1947 would immediately attract the levy of penalty under Section 23, irrespective of the fact whether the contravention was made by the defaulter with any "guilty intention or not". It is, therefore, apparent from these decisions that penalty is im-posable on the appellants for taking the wrong credit and utilising the same. I do not find any force in their submissions that for the purpose of working out the overdrawal, credit balance both in RG 23A Part II and PLA should be taken together into consideration. They have removed the finished product on payment of duty by debiting the credit entry, which was taken wrongly, in RG 23A Part II for which penalty is imposable on them. Their reliance on the decision in the case of Garden Reach Shipbuilders case is misplaced as in that case there were only irregularities in not adjusting the duty in the PLA on account of absence of the dealing clerk and there was sufficient credit balance in the PLA and, therefore, the facts are not similar.
Similar was the situation in the case of BHEL v. Collector as in the said case, the assessee had sufficient credits at the end of the two months after taking into account the total debits of duty required to be made by them. However, I find substance in their submission that the mitigating factor, such as finding out the mistake by the appellants themselves, their having taken corrective action by debiting the amount of wrong credit immediately and of informing the department, should be taken into consideration while imposing the penalty. It has been held by the Tribunal in the case of Indian Diamond Products v. Collector, Pune -1995 (78) E.L.T. 87 that the absence of mala fide on the part of the assessee can be taken into consideration for quantifying the amount of redemption fine and penalty. It is also observed that there is no allegation in the show cause notice or any finding in the impugned order that such wrong credit has been taken by the appellants repeatedly. I, therefore, feel that the ends of justice will meet if a penalty of Rs. 1 lac (Rupees One lakh only) is imposed on them. The penalty is, therefore, reduced from Rs. 13 lacs to Rs. 1 lac.
4. This excellent analysis has not been refuted by Revenue in their appeal memorandum. Accepting the logic and upholding the impugned order, we dismiss the appeal from the Revenue.