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KAY IRON WORKS (JORIAN) PVT. LTD. Versus COMMR. OF C. EX., DELHI-IV

2018 (2) TMI 814 - PUNJAB & HARYANA HIGH COURT

Penalty u/r 25 of CER - Whether Order passed by the learned Tribunal is sustainable when the Settlement Commission had settled the case of main notice? - Whether penalty under Rule 25 of the Central Excise Rules, 2002 is sustainable in case goods are not held liable to confiscation as there were no goods? - Held that: - it was conceded by the assessee before the authorities below that the invoices were issued without even supplying any goods. It was also recorded that the Settlement Commission d .....

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sions of Rule 25 of the Rules. In such cases, the penalty was held to be imposable - the Tribunal had correctly held that the quantum of penalty in the circumstances of the present case could not be faulted on the ground that it was excessive. - Appeal dismissed - decided against appellant. - C.E.A. Nos. 98 of 2014 and 1 of 2015 - Dated:- 24-7-2017 - Ajay Kumar Mittal and Amit Rawal, JJ. Shri Deepak Gupta and Sharan Sethi, Advocates, for the Appellant. Shri Tajender K. Joshi, Senior Standing .....

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8-2014, Annexure A.1, passed by the Customs, Excise & Service Tax Appellate Tribunal, New Delhi (in short, the Tribunal ) in Appeal No. E/476/2012, claiming following substantial questions of law :- (i) Whether Order passed by the learned Tribunal is sustainable when the Settlement Commission had settled the case of main notice? (ii) Whether penalty under Rule 25 of the Central Excise Rules, 2002 is sustainable in case goods are not held liable to confiscation as there were no goods? (iii) W .....

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Central Excise Intelligence (DGCEI) on the basis of intelligence visited the premises of M/s. TACL and summoned records for scrutiny. On the basis of the investigation, the DGCEI opined that the assessee supplied cenvatable invoices to M/s. TACL without supplying capital goods and violated the provisions of Central Excise Rules, 2002 (in short, the Rules ). The DGCEI vide show cause notice dated 5-3-2008 called upon the assessee to show cause as to why penalty under Rule 25 of the Rules should .....

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-10-2008, Annexure A.2. After rejection of the application by the Settlement Commission, the assessee contested the show cause notice and filed reply dated 17-3-2009. After considering the matter, the authority did not impose penalty under Rule 25 of the Rules, vide order dated 5-6-2009, Annexure A.3. Aggrieved by the order, the revenue filed an appeal before the Appellate Authority, vide order dated 26-5-2010, Annexure A.4, the Appellate Authority modified the order and allowed the appeal filed .....

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62,400/- under Rule 25 of the Rules was imposed on the assessee. Feeling aggrieved, the assessee filed an appeal before the Appellate Authority. Vide order dated 14-11-2011, Annexure A.6, the order dated 29-12-2010 was upheld. The assessee filed second appeal along with stay application before the Tribunal. Vide order dated 20-8-2014, Annexure A.1, the Tribunal dismissed the appeal. Hence the instant appeal by the appellant-assessee. 4. We have heard learned counsel for the parties. 5.&emsp .....

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here were no goods involved, the Tribunal relying upon the judgment of this Court in V.K. Enterprises v. CCE, 2011 (266) E.L.T. 436, had held that the person purporting to sell goods could not say that he was not concerned with selling of goods and had not contravened the provisions of Rule 25 of the Rules. In such cases, the penalty was held to be imposable. The relevant findings recorded by the Tribunal in this regard read thus :- 5. I have considered the facts and submissions of both sid .....

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a) takes note of the judgment in the case of S.K. Colombowala (supra) and holds that the benefit of the Settlement Commission s order cannot be extended to those who never approached the Settlement Commission. The learned Advocate stated that the order in case of K.I. International Limited has been stayed by the High Court, but I find that the stay is an interim stay on condition of 50% deposit and bank guarantee for the remaining amount which obviously means that what has been stayed is the con .....

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this very issue and has come to a finding that even in such cases, penalty can be imposed. The Hon ble High Court observed that the person purporting to sell goods cannot say that he is not concerned with selling of goods and has not contravened the provisions of Rule 25 ibid. Relevant paras (9&10) of the said judgment are quoted below : 9. As regards applicability of provisions introduced on 1-3-2007 to alleged acts committed prior to the said date, the matter is covered by orders of t .....

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