2016 (7) TMI 1289 - AT - Central Excise

Penalty - case of appellant is that the issue is covered by the judgment of this Tribunal in the case of Audi Automobiles vs CCE Indore 2009 (5) TMI 426 - CESTAT, NEW DELHI wherein in the identical set of circumstances, the demand of duty and interest was upheld while penalty was set aside - Held that - Respectfully following the said judgment of the Tribunal, we partly allow the appeal of M/s Audi Automobiles only to the extent that the penalty is set aside - appeal allowed - decided partly in favor of appellant.

Summary

Issues:
1. Confirmation of Central Excise duty short payment
2. Liability for interest on confirmed amount
3. Imposition of penalties on Noticee No. 1, 2, and 3

Confirmation of Central Excise Duty Short Payment:
The Order in Original dated 20.02.2009 confirmed a Central Excise duty amount of &8377; 1,81,29,621 short paid by Noticee No. 1 during April 2007 to September 2007. The duty was to be recovered from them under Section 11A(1) of the Central Excise Act, 1944.

Liability for Interest:
In addition to the duty, Noticee No. 1 was also held liable to pay interest on the confirmed amount as per Section 11-AB of the Central Excise Act, 1944. This was a separate liability imposed on them.

Imposition of Penalties:
Penalties were imposed on Noticee No. 1, Noticee No. 2, and Noticee No. 3 under different rules of the Central Excise Rules, 2002. Noticee No. 1 was penalized &8377; 1,81,29,621 under Section 11-AC of the Central Excise Act, 1944, while Noticee No. 2 and Noticee No. 3 were each penalized &8377; 30,00,000 under Rule 26 of the Central Excise Rules, 2002.

Judgment Analysis:
The appellants' advocate argued that the issue in question was similar to a previous judgment by the Tribunal in the case of Audi Automobiles vs CCE Indore. In that case, the demand for duty and interest was upheld, but the penalty was set aside. Following the precedent, the Tribunal partly allowed the appeal of M/s Audi Automobiles by setting aside the penalty. The appeals of Sh. Ashok Sharma and Ms. Eicher Motors Ltd. were also allowed, as the penalties imposed on them were set aside. The judgment was pronounced in open court after considering the arguments presented by both sides.