This appeal is filed by the Department challenging the order passed by the Customs, Excise and Service Tax Appellate Tribunal dated 13.08.2010, vacating the levy of penalty of Rs. 6,00,000/- imposed by the Commissioner of Central Excise.

2. The brief facts of the case are that:

The assessee is engaged in manufacture and clearance of excisable goods viz., PCB Assemblies, TV tuners, Settop boxes under Chapter 85 of the Schedule to Central Excise Tariff Act, 1985, and are also availing benefit of Cenvat Credit facility under Cenvat Credit Rules.

It was noticed by the Department that there was irregular availment of Cenvat credit by the assessee and after passing adjudication proceedings, the Commissioner of Central Excise imposed penalty of Rs. 6,00,000/- under Rule 13 of Cenvat Credit Rules, 2002 read with Section 11AC of the Central Excise Act, 1944.

3. The assessee carried the matter in appeal before the Customs, Excise and Service Tax Appellate Tribunal and the Tribunal after examining the issue at length, has held that there was no intention on the part of the assessee to evade payment of duty and as such, the penalty of Rs. 6,00,000/- imposed by the Commissioner was not