2017 (5) TMI 1130 - AT - Central Excise

Penalty u/r 209A of the CER, 1944 - Held that - not only demand against main appellant M/s. Ferro Alloys Corpn. Ltd but also other appellants, Shri. Vinod Saraf and Shri. P.D. Lele on whom penalties u/r 209A was imposed have been dropped. The present appellants against whom penalties u/r 209 A were imposed are also on the same footing of the Shri. Vinod Saraf and Shri. P.D. Lele and therefore present appellants also deserve the same relief - Once the said duty demand was set aside, consequential penalties imposed on the present appellants also do not sustain - penalties set aside - appeal allowed - decided in favor of appellant.

Summary

Issues: Appeals against penalties imposed under Rule 209A of the Central Excise Rules, 1944.

Detailed Analysis:
1. Background: Three appeals were filed challenging penalties imposed by the Adjudicating authority under Rule 209A. The penalties were imposed on the appellants, and they sought to have them set aside.

2. Appellant's Argument: The counsel for one of the appellants argued that the penalty was consequential to a demand confirmed against another party. The Tribunal had previously dropped the demand against that party, leading to the conclusion that the penalty should not be sustained.

3. Revenue's Position: The Assistant Commissioner representing the Revenue acknowledged the Tribunal's decision regarding the demand against the other party. However, the Revenue had filed an appeal in the High Court, which had not granted a stay on the Tribunal's decision.

4. Tribunal's Evaluation: After considering both sides' submissions and reviewing the records, the Tribunal noted a common adjudicating order against multiple parties, including the main appellant and other individuals. The Tribunal had previously allowed the appeal by the main appellant, concluding that there was no evidence to support the duty demand and penalties imposed.

5. Tribunal's Decision: The Tribunal found that the impugned order confirming the duty demand and penalties was unsustainable. Therefore, the penalties imposed on the appellants were set aside, and the appeals were allowed with consequential relief, if any.

6. Final Ruling: The Tribunal emphasized that not only the demand against the main appellant but also the penalties imposed on other appellants were dropped. The penalties were directly linked to the demand confirmed against the main appellant, which was set aside. Considering the absence of a stay on the Tribunal's decision by the High Court, the penalties on the present appellants were also set aside based on the earlier order. Consequently, the appeals were allowed with any necessary consequential relief in accordance with the law.