Full Judgment
The Commissioner (Appeals) has extracted the relevant portion of the Ordere-in-Original:- "The said assessee, failed to furnish requisite Bond and Bank Guarantee and therefore the demand were issued to the said assessee vide Show Cause Notice No. MP/13-Navsari/Pearim/94 dtd. 14.2.96 by concerned Range Supdt. The said assessee was also asked why penally under Rule 173Q should not be imposed on them for not filing declaration.
The Price List No. 55/91, 91/91, 98/91, 45/93 & 46/93 were approved vide OIO No. SRT-IV/ADJ/25/96/PL dtd. 29.2.1996 without any change.
In view of the same, aforesaid demand is not; sustainable and is dropped. However, since the assessee failed to follow procedure u/r 9B of CER, 194, I impose a penalty of Rs. 10,000/- (Rupees Ten Thousand ) on (hem u/r 173Q of CER, 1944".
2. Following the Supreme Court decision reported 1995 (76) ELT 497 wherein the Supreme Court held that penalty is not imposable, unless department is able to sustain its demand, the Commissioner observed that no demand has been worked out, no short levy was found and so no penalty could have been imposed. He set aside the order of penalty.
3. The respondents manufacture P or P Medicines they filed a Pirce List effective from 5.1,91 in respect of their product MODCAT 20 Capsules, manufactured by them on account of their loan licence M/s. Alvetra Laboratories Pvt. Ltd. The Assistant Commissioner ordered provisional assessment and directed the assessee to execute a bond backed by a Bank Guarantee of 25%. The assessee failed to execute the bond and Bank Guarantee. The Assistant Commissioner later on noticed that the department had already approved the various Price Lists filed by the assessee Vide Order-in-Original No. SRT/ADJ/256/96/PL dt.29.2.96 without any change. He then passed the impugned order in 1997 holding that no differential duty is payable but all the same he imposed a penalty of Rs. 10,000/- on the assessee for not adhearing to his order asking him to execute a bond and Bank Guarantee during the period when provisional assessment was resorted to.
4. In appeal the Commissioner (Appeals) set aside the order imposing penalty on the ground mentioned in his order.
5. The department's grievance is that penalty ought not to have been set aside by the Commissioner as the assessee is liable to penal action under Rule 173Q in as much as he failed to follow the procedure laid down in Rule 9(B) even though he was specifically asked to do so. The other ground is that the Supreme Court's decision relied upon by the Commissioner is not applicable.
6. None present for the respondents. Heard the Ld. DR and perused the records.
7. It is not understood how many Assistant Commissioners would sit in judgment over the same issue. The issue pertained to approval of price lists filed somewhere in 91 & 93. In 96 one Assistant Commissioner approved them without any change. In 97 another Assistant Commissioner feels that no change in the price lists is called for as they were approval in 96 but imposes a penalty of Rs. 10,000/- on the assessee for not following his direction. The whole exercise is uncalled for. If at all, such an action of imposing a penalty is called for, it should have been done in 96 when the price lists were finalised.