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Facts:
The short question under consideration was whether penalty u/s. 76 of the Finance Act, 1994 (the Act) be reduced below the minimum limit prescribed by invoking section 80 of the Act. The department argued that the Commissioner (Appeals) and CESTAT had no authority to reduce the penalty as provided in the law.
Held:
Applying the decision of the Gujarat High Court in Port Officer 2010 (19) STR 641 (Guj), it was observed that section 80 of the Finance Act, 1994 had an overriding effect over sections 76, 77, 78 and 79 of the Act (the Act) and no penalty was imposable in case of reasonable cause for failure to comply with laws as provided in respective sections. The authorities, Commissioner (Appeals) and CESTAT however, do not have powers to levy penalty below minimum prescribed limit and therefore, it was held that penalty u/s. 76 could not be reduced below the minimum prescribed limit by invoking section 80 of the Act.
