IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION CENTRAL EXCISE APPEAL NO. 78 OF 2004 The Commissioner of Central Excise. ... Appellant. V/s. M/s.Godrej Soaps Ltd. ... Respondent. A.S.Rao for the appellant. Prakash Shah i/b. PDS Legal for the respondent. CORAM : V.C.DAGA AND S.J.KATHAWALLA, JJ. DATED : 27th July 2010. P.C. : Heard learned counsel for the appellant- Revenue and learned counsel for the respondent. Perused appeal. 2. This appeal has been admitted on the following substantial question of law: “1. Whether the penalty under Rule 571(4) is tobe imposed equal to duty/ the Credit so disallowed? 2. Whether the interest under Rule 571(5) is to be imposed from the first day of the month succeeding in which the credit was wrongly taken or from the date of utilisation of credit? 3. So far as second question is concerned, Mr.Rao, learned counsel for the appellant- Revenue does not press this question. 4. So far as first question is concerned, Mr.Rao placed reliance on the judgment of the Division Bench of this Court in the case of Commissioner of C.Ex. & Cus., Raigad v. Fibre Foils Ltd., 2009 (241) ELT 201 (Bom). The very same judgment holds that the imposition of penalty is mandatory but it is not necessary that 100% penalty should always be imposed. It can be reduced depending upon the reasons given. In the circumstances, so far as first question is concerned, the same is answered in terms of the Division Bench judgment against the Revenue and in favour of assessee for the reasons recorded therein. 4. Appeal stands disposed of accordingly with no order as to costs. (S.J.KATHAWALLA, J.) (V.C.DAGA J.)