ORDER
M.P. Bohra, Member (J)
1. This appeal has been filed by the Revenue against the order of the Commissioner (Appeals) of Central Excise, Kolkata passed on 24th March, 2003.
2. We have heard Shri A.K. Mondal, ld. SDR for the Appellant-Revenue and Shri Bhaskar Sen, ld. Sr. Advocate for the respondents.
3. In the present appeal, the question is whether the appellant is liable to pay penalty at the rate of 100% on the entire excise duty under Section 11AC and is also liable to pay interest on the entire excise duty under Section 11AB of Central Excise Act, 1944. Ld. SDR, Shri Mondal submits that the present case is under Section 11AC proviso and the respondent has not paid interest. Accordingly, he is liable to pay the entire penalty and interest thereon.
4. In reply Shri Bhaskar Sen, ld. Sr. Advocate submits that in the present case, the entire duty and 25% penalty thereof, has been deposited prior to determination of the duty liability. Under these circumstances, the respondent was not under an obligation to pay more than 25% as penalty of the duty amount. He further submits that the entire duty and penalty was paid prior to determination of the duty so the question of chargeable of the interest does not arise. He, therefore, submits that the appeal may kindly be dismissed.
5. In the present case, the show cause notice was issued on 27th April, 2001. As mentioned in the order-in-original that the duty was paid as under :
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Cheque No. & Date Drawn on Amount
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003830 dt. 3-7-2000 UCO Bank Rs. 5,00,000.00
005864 dt. 31-3-2001 Do Rs. 1,50,000.00
005865 dt. 12-4-2001 Do Rs. 5,00,000.00
005866 dt. 14-5-2001 Do Rs. 5,37,016.00
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Rs. 16,87,016.00
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From the perusal of the above, it is clear that the entire duty along with penalty was paid within one month from the date of issuance of the show cause notice. Out of Rs. 16,87,016.00, the amount of Rs. 11,50,000/- was paid prior to issuance of the show cause notice i.e. 27th April, 2001. The chargeability of interest only comes into play when the duty liability is determined. In the present case the entire duty and the 25% of the penalty of the duty was paid much prior to determination of duty which was determined on 11th September, 2001 whereas the entire duty and penalty was paid prior to 15th May, 2001. The interest can only be charged after the determination of the duty. In the present case, the entire duty has been paid prior to determination of the duty. Not only this, Rs. 11,50,000/- was deposited prior to issuance of the notice. Where the duty has been paid prior to issuance of the notice, the penalty and the interest are not imposable as held by the Larger Bench in the case of Commr. of Central Excise, Delhi-III v. Machine Montell (I) Ltd. reported in 2004 (168) E.L.T. 466 {Tri. – LB). In view of the above discussions, we do not find any force in the submissions of the ld. SDR. Therefore, the appeal deserves to be dismissed.
6. Accordingly, we dismiss the appeal.