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2. Honble High Court of Gujarat in Tax appeal filed by Revenue, has remanded the matter to this Tribunal with following directions.

The question raised in the appeals is whether the Tribunal has correctly applied the provisions of Rule 96ZQ (ii) of CER, 1944 and/or also the provisions of Section 11AC of CEA, 1944. The Tribunal has reduced the penalty exercising its direction. The Apex Court in the case of UoI Vs.Dharmendra Textile Processors 2008 (231) ELT 3 held that once the ingredients are satisfied, imposition of penalty is a mandatory requirement and no discretion is available.

Learned Counsel appearing for the assessee referred to an order passed by the Supreme Court in the case of UoI Vs. Dharmendra Textile Processors 2007 (215) ELT 321, especially Para 9 of the order, and stated that vires of Section 96ZQ is under challenge before this Court as well as before the Supreme Court and that being the fact situation, it is not necessary to remand the matter to the Tribunal for consideration afresh. We find it difficult to accept this contention.

In the facts of the circumstances of the case, we are satisfied that in light of the law laid down by the Apex Court in the case of UoI Vs. Dharmendra Textile Processors 2008 (231) ELT 3, the matters require to be considered by the Tribunal afresh. Therefore, the order of the Tribunal is set aside. The matters are remanded to the Tribunal for passing fresh orders in accordance with the law. The question of applicability of proviso to Section 11AC will also be considered and examined by the Tribunal while deciding the matter afresh. The Tribunal shall pass fresh order within a period of three months from the date of receipt of a copy of this judgment.