2009 (11) TMI 706 - AT - Central Excise

Summary

Issues:
Penalization under Rule 173Q of Central Excise Rule, 1944.

Detailed Analysis:
The judgment revolves around the issue of penalization under Rule 173Q of the erstwhile Central Excise Rule, 1944. The appellant, represented by the SDR, appealed against the penalty imposed by the original authority. The crucial question was whether the respondent should be penalized as per Rule 173Q. Despite notice, the respondent did not appear, but a letter seeking adjournment was submitted by an advocate without a Vakalatnama, which was not accepted. The Tribunal proceeded to examine the records and found that the Commissioner (Appeals) had made significant findings that were overlooked by the appellant.

Crucial Findings:
The lower appellate authority had noted that the respondent had intimated the department about taking the Modvat credit in question and that the credit was frozen at the instance of the department, indicating it was not utilized for duty payment. The reversal of credit by the respondent was done under protest after receiving show-cause notices. It was evident that there was no concealment from the department, and a dispute existed regarding the credit's admissibility. The original authority had imposed a penalty without citing any specific provision, which was set aside by the Commissioner (Appeals). The Commissioner found no evidence of deliberate defiance of the law by the respondent, which remained unquestioned in the current appeal.

Decision:
Based on the above analysis, the Tribunal upheld the order of the Commissioner (Appeals) and dismissed the appeal of the Revenue. The judgment emphasized the importance of considering all relevant findings and evidence before imposing penalties and highlighted the need for a clear legal basis for such actions.