2011 (3) TMI 1532 - HC - Central Excise

Summary

Issues:
Challenge to order passed by Customs, Excise and Service Tax Appellate Tribunal; Imposition of penalty under Section 11AC and interest under Section 11AB; Personal penalties imposed on individuals.

Analysis:
The appellant, Commissioner of Central Excise and Customs, challenged an order passed by the Customs, Excise and Service Tax Appellate Tribunal, Mumbai, under Section 35G of the Central Excise Act, 1944. The Court had formulated three questions at the time of admitting the appeal. The first question pertained to the Tribunal setting aside the mandatory penalty under Section 11AC and interest under Section 11AB when duty evasion was detected by the Department. The second question related to setting aside penalties under Sections 11AC and 11AB, which are mandatory, despite clear evidence of duty evasion. The third question was about the Tribunal setting aside personal penalties imposed on individuals involved in the duty evasion scheme.

The case involved a show-cause notice issued in 1999, resulting in a demand of duty against a company and imposition of penalties. The Commissioner (Appeals) upheld the penalties, leading to the matter being taken to the Tribunal. The Tribunal's impugned order set aside certain penalties imposed on the respondent based on its findings of fact. The appellant reiterated the reasoning of the Adjudicating Authority and the Commissioner, while the respondent argued that the questions formulated by the Court did not arise from the Tribunal's order as it was based on factual findings. The Tribunal concluded that no reason existed for imposing certain penalties under the Rules and accordingly deleted them. Due to the absence of any question of law, the appeal was dismissed.