JUDGMENT N. Kumar, J.—This is an appeal filed by the revenue challenging the order passed by the Tribunal setting aside the order imposing penalty. 2. The material on record discloses that the assessee was liable to pay duty for the month of August, 1997 calculated on ACP basis at Rs. 9,60,000/-. However, the assessee discharged the duty liability on actual clearance which was Rs. 4,15,271/- only. At no point of time the assessee had discharged the duty on the basis of ACP norms as the same was effective only from 1-9-1997. In those circumstances the authorities levied the duty and penalty and the assessee was discharged from liability to pay duty on ACP basis. But he paid duty on actuals. But ultimately after a prolonged period of nearly 10 years he accepted the finding of the authority that he is liable to pay on ACP basis and he paid the duty and interest. It is in this context the question for consideration is, whether he is liable to pay penalty? Though the relevant Rule provides that the penalty is liable to be paid if the assessee fails to pay duty within the stipulated period, Section 11AC which is the Section which imposes penalty clearly provides under what circumstances the penalty is leviable. The Rule framed which is in consonance with the main Section read as a whole, makes it very clear that he is liable to pay duty only if assessee continues the acts which are mentioned in the said Section with an intention to evade payment of tax. If the intention of payment of tax is not there and if the assessee is contesting their liability and if he has paid the duty and interest, it cannot be said that a case for imposing penalty is made out. Though the Tribunal has not given the reasons for not levying penalty, in the facts and circumstances of the case we are satisfied that it is not a case where the assessee can be accused of conducting in such a manner so as to evade payment of tax. As he has paid the duty and interest we do not find any justification, to interfere with the order passed by the Tribunal granting him the relief of nonpayment of penalty. Accordingly, the appeal lacks merit and it is dismissed. As he has paid the duty and interest we do not find any justification, to interfere with the order passed by the Tribunal granting him the relief of nonpayment of penalty. Accordingly, the appeal lacks merit and it is dismissed. The substantial question of law is answered against the revenue and in favour of the assessee.