2007 (5) TMI 545 - AT - Central Excise

Summary

Issues Involved:
1. Common issue of penalty imposition under Rule 96ZQ 5(ii) for delayed payment.
2. Reduction of penalties by Commissioner (Appeals) and appeals for total waiver by assessees.
3. Department's appeal seeking restoration of penalties imposed by the original authority.

Analysis:

Issue 1: Common issue of penalty imposition under Rule 96ZQ 5(ii) for delayed payment:
- Multiple appeals arising from the same order of Commissioner (Appeals) involved penalties imposed under Rule 96ZQ 5(ii) for delayed payment by assessees under the compounded levy scheme.
- Original authority imposed penalties equal to the outstanding amount at the end of the due date, which were subsequently reduced by the Commissioner (Appeals).
- Assessees appealed for total waiver of penalties, while the Department appealed for restoration of the original penalties.

Issue 2: Reduction of penalties by Commissioner (Appeals) and appeals for total waiver by assessees:
- Specific cases highlighted instances where penalties were reduced by the Commissioner (Appeals) from the original amounts imposed by the authority.
- Assessees argued for complete waiver of penalties, citing various reasons for the delayed payments, such as financial constraints and unintentional delays.
- The Tribunal considered the circumstances of each case to determine the appropriate penalty amount, taking into account the principles laid down by the Hon'ble High Court in similar cases.

Issue 3: Department's appeal seeking restoration of penalties imposed by the original authority:
- The Department contended that penalties should be imposed even for minor delays, as per the rule, with a minimum penalty of Rs. 5,000 or the outstanding amount at the due date, whichever is higher.
- The Tribunal examined the submissions from both sides and considered the intention behind the delays, emphasizing that penalties should be proportionate to any gains made by the party.

Conclusion:
- The Tribunal allowed the appeal of an assessee where the delay was not attributable to them, setting aside the penalty.
- In cases where delays were admitted but no intention to evade duty was found, penalties were reduced to Rs. 5,000 for each default, aligning with the principles established by the Hon'ble High Court.
- The Tribunal partially allowed some Department appeals by enhancing penalties to Rs. 5,000 in specific cases, while also partially allowing appeals by reducing penalties in other cases based on the circumstances presented.
- The judgment was pronounced on 15-5-2007, providing a comprehensive resolution to the penalty imposition issues across multiple appeals.