TMI Blog2016 (11) TMI 990X X X X Extracts X X X X X X X X Extracts X X X X ..... had upheld the penalty under Rule 26 of the Central Excise Rules, 2002 even in case where there is no proposal for confiscation. The third contention raised by the appellant relates to invocation of provision of sub-section (2A) of Section 11A, I find that the said provisions can be invoked only in respect of such persons on whom notices are served under sub-section (1) of Section 11A. In this case, notice under Rule 26 of the Central Excise Rules, 2002 has been served to all the appellants. The penalties are reduced from ₹ 1 lakh to ₹ 75,000/- on Shri Mahendra K Agrawal, Manish R Agrawal & M/s Diamond Roadways and from ₹ 25,000/- to ₹ 20,000/- on Shri Ramavtar K Agrawal - appeal disposed off - decided against ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... T 51 (Tri-Del) and in case of Bajrang Metallic Power Pvt. Ltd. - 2013 (295) ELT 232 (Tri-Del). He further argued that no confiscation has been ordered and therefore, no penalty can be imposed under Rule 26. For this assertion, he relied on the decision of the Tribunal in case of Air Carrying Corporation P. Ltd. - 2008 (229) ELT 80 (Tri-Mum). He further argued that Rule 26(2) of the Central Excise Rules was introduced w.e.f. 1.3.2007 and the said rule cannot be invoked for offences committed before 2007. For this assertion, he relied on the decision of the Hon'ble High Court of Punjab Haryana in case of Mini Steel Traders - 2014 (309) ELT 404 (P H). 4. Learned AR for the Revenue relies on the impugned order. He argued that Hon&# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 11A. In this case, notice under Rule 26 of the Central Excise Rules, 2002 has been served to all the appellants. In this regard, Tribunal in case of Anand Agrawal - 2013 (288) ELT 90 (Tri-Del) has observed as follows: - 4. Sub-section (1) of Section 11 provides for issuance of show cause notice demanding short-paid or non-paid duty within the period of either one year from the relevant date or five years where there is mis-statement or suppression of facts. Sub-section (1A) which was introduced w.e.f. 13-7-2006 gives the option to person to whom the notice is served under the proviso to sub-section (1) by Central Excise officer to pay duty in full or in part along with interest and penalty equal to the 25% of the duty within a period of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1) of Section 11 and who have paid the duty along with interest and 25% of penalty within a period of 30 days of receipt of the notice. Accordingly, it has to be concluded that the proceedings do not come to an end in respect of all the persons in as much as the expression used in the said proviso is only in respect of such persons and not all the noticees. 6. I also find that the proviso to Section 2 also refers to the other persons. As such it has to be seen as to who other person can be in respect of which the proceedings would get concluded on payment of duty interest and part penalty. The said proviso does not refer to all other persons, but the same qualifies the other persons to whom notices are served under sub-section (1). As ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... greater. 8. As is seen from the above, the invocation of penal provision of Rule 26 is dependent upon so many factors which are unconnected with the provisions of Section 11A. No doubt a combined show cause notice under Section 11A demanding short-paid or non-paid dues along with proposal to imposition of penalties under Rule 26 is issued but as already discussed, the two proposals are independent of each other and mutually exclusive. Rule 26 which provides for imposition of penalty in certain circumstances cannot be said to be a part of the proviso to sub-section (2) of Section 11A so as to conclude the proceedings in respect of all noticees on payment of duty, interest and part penalty by main manufacturer. The said proviso, in my vi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ect to regular proceedings as per the law. 10. A reading of the above circular nowhere clarifies the issue as to whether payment by the main manufacturer would result in stopping of proceedings in respect of all the persons or the same would amount to settle the dispute vis-`-vis the main manufacturer only. As such nothing turns on the said Circular. 6. In view of the above, the grounds raised by the appellant do not survive. However, looking at the role of the appellant and fact that the duty and penalty has been paid by the main appellants, the penalties are reduced from ₹ 1 lakh to ₹ 75,000/- on Shri Mahendra K Agrawal, Manish R Agrawal M/s Diamond Roadways and from ₹ 25,000/- to ₹ 20,000/- on Shri Rama ..... X X X X Extracts X X X X X X X X Extracts X X X X
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