3 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION CENTRAL EXCISE APPEAL NO.148 OF 2006 Commissioner of Central Excise & Customs ...Appellant. v. M/s.ShivKripa Ispat Pvt. Ltd. ...Respondents. Mr. A.S.Rao with Rajinder Kumar, advs. for the Appellant. None for the Respondents. CORAM : F.I. REBELLO & J.H. BHATIA, JJ. DATED : 18TH JUNE, 2009 P.C. 1 Appeal was admitted on the following question: “(a) When the demand involving the proviso under Section 11A is confirmed whether the adjudicating authority or other appellate authorities has the discretion to reduce the penalty equal to the duty demand confirmed imposed under Section 11AC of the Central Excise Act, 1944 ? 2 The Tribunal relied upon the judgment of the larger bench in Machino Montell 2004 (168) ELT 466. That view, it is contended has been approved by this Court in Commissioner of Central Excise v. Gaurav Mercantile Limited 2005 (190) ELT 11 (Bom.). 3 3 The Supreme Court has now concluded the matter in Union of India v. Rajasthan Spinning & Weaving Mills 2009 (238) E.L.T. 3 (S.C.). From the ratio of that judgment it would be clear that mere payment before issuing show-cause notice cannot result in non- imposition of penalty if the other ingredients are satisfied. Once the provisions of penalty are attracted, it will have to be seen whether the provisions of Section 11AC are satisfied before the penalty can be imposed. In the instant case, that has not been considered. In Commissioner of Central Excise-I v Gaurav Mercantiles Ltd. 2005 (190) E.L.T. 11 (Bom.), this Court referred to the judgments of the Madras High Court and Karnataka High Court and to an appeal preferred from the judgment in Rashtriya Ispat Nigam Ltd. v. Commissioner of Central Excise, Vishakhapatnam. In an appeal taken out had been dismissed by the Supreme Court held that no substantial question of law arises. It is thus clear that this Court really did not address itself to the issue. In our view considering the Rajasthan Spinning & Weaving Mills (Supra), the impugned order is set aside and the matter remanded back to the Tribunal for re-considering the issue in terms of 3 the law laid down by the Supreme Court in Rajasthan Spinning & Weaving Mills (Supra). (J.H. BHATIA,J.) (F.I. REBELLO,J.)