Judgment 1. The revenue has approached this Court by filing the present appeal under Section 35G of the Central Excise Act, 1944 (for short the Act) arising out of order dated 19-1-2005, passed by the Customs, Excise & Service Tax Appellate Tribunal, New Delhi (for short, the Tribunal) by raising following substantial questions of law : (i) Whether the Tribunal is correct in granting abatement when only one furnace and not the factory as a whole, was closed which was the prerequisite for claiming abatement as provided under Sub-section (3) of Section 3A of the Central Excise Act, 1944 ? (ii) Whether penalty imposed under Rule 96ZO(3) upon a manufacturer ofnon-alloy steel ingots falling under Chapter 72 of the Schedule to the Central Excise Tariff Act, 1985 (5 of 1986) and who opted to pay duty under Section 3A of the Central Excise Act, 1944 read with Induction Furnace Annual Capacity Determination Rules, 1997 but failed to pay the whole of the amount payable for any month by the 15th day or the last day of such month, as the case may be, is mandatory or discretionary in nature ? 2. Briefly, the facts are that the assessee in the present case was having two induction furnaces of 2.5 MT and 3 MT respectively. A scheme for compounded levy of duty was introduced w.e.f. 1-9-1997 with newly inserted Section 3A in the Central Excise Act, 1944 (for short the Act) and correspondingly Rule 96ZO(3) was also added in the Central Excise Rules, 1944 (for short, the Rules). The assessee is manufacturer of non-alloy steel ingots falling under Sub-heading 7206.90 of the First Schedule to Central Excise Tariff Act, 1985. 3. As far as 1st question is concerned, it is not in dispute that for both the furnaces, the capacity as per the Capacity Determination Rules, was assessed separately. Both the furnaces have independent and separate electricity connections and their production was recorded separately, which were duly checked and verified by the Officers of the Department while visiting the factory premises from time to time. It is also not in dispute that the Department had allowed independent/separate registration to both these furnaces, which were identified as Units A and B consisting of one furnace each. It is also not in dispute that the Department had allowed independent/separate registration to both these furnaces, which were identified as Units A and B consisting of one furnace each. Proviso to Section 3A(3) of the Act provides for a claim for abatement of duty in case the factory remains closed for more than seven days and intimation about the same is furnished to the Department in advance. As one of the furnaces which according to the assessee is complete factory in itself, remains closed, claim for abatement of the duty was made by the assessee. The same was rejected by the adjudicating officer, for the reason that the factory, as a whole, was not closed and it was merely one furnace which was closed. 4. In appeal before the Tribunal, claim of the assessee was allowed by the Tribunal by recording the following findings : 7. Both the furnaces installed by the appellants in their factory, as observed above, had been working independently and their production during the disputed period were recorded separately in separate records, by the appellants. Both the furnaces had also independent electricity connections and whenever any furnace was closed, the appellants furnished its meter reading to the department. The production of each furnace recorded in separate record and the meter readings furnished by the appellants at the closure of the furnace, were also checked/verified, from time to time by the officials of the department. Both the furnaces had thus independent status and were also marked/numbered as units A and B by the appellants for the purpose of recording their production and electricity consumption and closure. This position was never disputed by the department, also at the time of visit to the premises of the appellants. The department even allotted independent/separate registrations to both these units A and B consisting of one furnace each, from 1-4-98. The adjudicating authority has even allowed the abatement claims of the appellants from 2-4-98 also on account of closure of one unit/furnace for the periods detailed above. 8 There is no dispute that during the periods mentioned above for which the abatement claims have been disallowed by the adjudicating authority, the unit/furnace of the appellants remained closed. The meter reading of the concerned furnace was also furnished by the appellants to the department. 8 There is no dispute that during the periods mentioned above for which the abatement claims have been disallowed by the adjudicating authority, the unit/furnace of the appellants remained closed. The meter reading of the concerned furnace was also furnished by the appellants to the department. Therefore, the abatement claims of the appellants for these periods could not be disallowed for the simple reason that both the furnaces installed in the factory were not closed. Each furnace constituted an independent unit factory in the light of the facts detailed above and the sanction of independent registration by the department to each furnace w.e.f. 1-4-98. The ratio of law laid down in M/s. Waryam Steel Castings (supra) could not be applied to the case of the appellants as in that case, there was no independent installation of meter and maintenance of record by the assessee regarding the production of each furnace and at no stage, separate independent registration in respect of each unit/furnace was granted to the assessee. It was for these reasons, the Tribunal took the view that the abatement was not permissible for non- closure of the entire unit/factory. But in the present case, the facts and circumstances detailed above are quite different. 9 In the light of discussion made above, the adjudicating authority has, in our view, wrongly disallowed the abatement claims of the appellants for the periods detailed above. The impugned order in that regard cannot be sustained and is set aside. The abatement claims of the appellants are allowed for these periods. 5. We have perused the findings recorded by the Tribunal. 6. The counsel for the Revenue has relied upon a judgment of Patna High Court in Balajee Ingot India Pvt. Ltd . v. Union of India - 2004 (167) E.L.T. 389 to buttress his arguments that the closure of one furnace in a factory does not amount to closure of the factory as such, accordingly, abatement claim cannot be allowed as the same would be in violation of the provision of Section 3A(3) of the Act. Admittedly, the leave to appeal has been granted by Honble the Supreme Court against the judgment in Balajee Ingots case (supra). 7. We have considered the submissions made by the counsel. The judgment in Balajee Ingots case (supra) is clearly distinguishable on facts and the same does not support the arguments addressed by the counsel for the Revenue. Admittedly, the leave to appeal has been granted by Honble the Supreme Court against the judgment in Balajee Ingots case (supra). 7. We have considered the submissions made by the counsel. The judgment in Balajee Ingots case (supra) is clearly distinguishable on facts and the same does not support the arguments addressed by the counsel for the Revenue. In the case relied upon, the factory was a composite unit having two induction furnaces, either of which remained closed and on that basis the claim of the abatement duty was made. The facts as found by the Tribunal in the present case clearly show that two furnaces set up by the assessee were two complete factories, though may be situated in the same compound. Once these facts are not in dispute, we do not find any reason to differ with the view taken by the Tribunal. 8. As far as 2nd question is concerned, we have already held in C.E.A. No. 77 of 2005 - Commissioner , Central Excise Commissionerate , Ludhiana v. M/s. K.C. Alloys & Steel Castings, Ludhiana , decided on 3-8- 2006 [2006 (206) E.L.T. 1183 (P & H)], that the kind of penalty provided under Rule 96ZO(3) of the Rules is not mandatory or minimum but discretionary and maximum prescribed under the Rules. As in the present case, the Tribunal has set aside the penalty, as undisputed facts on record are that delay in payment was for the reason that abatement claim of the assessee was pending consideration. We dont find any reason to differ with the view taken by the Tribunal. 9. Accordingly, the appeal is dismissed.