Mandatory Penalty for short-levy or non-levy of duty in certain cases [Section 114A] :

(a) Penalty for non-levy/short levy of duty/where the interest has not been charged/ paid/has been part paid or duty/interest has been erroneously refunded: In cases of nonlevy or short levy of duty or where the interest has not been charged or paid or has been part paid or the duty or interest has been erroneously refunded by reason of :-

(i) collusion or

(ii) any wilful mis-statement or

(iii) suppression of facts

person who is liable to pay the duty or interest, as the case may be, as determined under sub-section (8) of section 28 shall also be liable to pay a penalty.

(b) Amount of penalty: Amount of penalty shall be equal to the duty or interest so determined.

(c) Benefit of reduced penalty available if duty/interest and interest on delayed payment of duty paid within thirty days: Where such duty or interest, as the case may be, and the interest on delayed payment of duty, is paid within thirty days from the date of the communication of the order, the amount of penalty to be paid shall be reduced to 25% of the duty or interest.

However, aforementioned benefit of reduced penalty is available only if the amount of penalty so determined has also been paid within the said period of thirty days.

(d) Increase/decrease in the amount of duty/interest payable determined: If the duty or interest determined to be payable is reduced or increased by the Commissioner (Appeals), the Appellate Tribunal or, as the case may be, the Court, then, the duty or interest as reduced or increased, as the case may be, shall be taken into account.

(e) Benefit of reduced penalty available if increased duty/interest and interest on delayed payment of duty and 25% of consequentially increased penalty paid within thirty days: In a case where the duty or interest determined to be payable is increased by the Commissioner (Appeals), the Appellate Tribunal or, as the case may be, the Court, then, the benefit of reduced penalty shall be available if the amount of the duty or the interest so increased, along with the interest on delayed payment of duty, and 25% of the consequential increase in penalty have also been paid within thirty days of the communication of the order.

(f) Section 112/114 not to apply: Where any penalty has been levied under this section, no penalty shall be levied under section 112 or section 114.