If your site has been penalized by Google and you thought it would never ever appear again in the rankings, this step of them will delight you. Google is now partially removing penalties, provided you have taken visible steps for removing the links.
A discussion in Google’s Webmaster Central forum confirms that Google partially revokes the penalty if they see significant action on their notification regarding inorganic links.
Google penalizes sites for inorganic links pointing to them. However, they’re now re-evaluating the site’s backlinks on request and partially revoke manual action if they find that the site has done work to get inorganic links removed. They’re even willing to fully remove the ban if they make further progress on the link removal.
Once the penalty is revoked, the search ranking of the sites begins improving. However, the change is not overnight and it might take some time before the changes take affect. It also doesn’t mean that the previous ranking of the site will be restored. The algorithm will factor in the variables before putting it up in the search results.
This difference in approach is certainly better than their all or nothing approach with these penalties.Google Penalty - Your Site Can Bounce Back Now!,