2013 (5) TMI 433 - AT - Central Excise

Waiver of predeposits/penalties - Held that - As the penalties also stands set aside by the Commissioner (Appeals) earlier order dated 20th December 2007, the subsequent order of Commissioner (Appeals) against the same impugned order in original, upholding the penalties imposed on the present applicants is not legal. Accordingly, after dispensing with the condition of pre-deposit appeal is allowed. Stay petition as also appeals get disposed on in above manner.

Summary

Issues:
- Application to dispense with pre-deposit of penalties
- Challenge to penalties imposed by original adjudicating authority
- Commissioner (Appeals) setting aside penalties
- Subsequent upholding of penalties by Commissioner (Appeals)
- Legality of upholding penalties in subsequent order
- Decision on appeals and stay petition

Analysis:
The judgment addresses an application seeking dispensation of the pre-deposit of penalties amounting to Rs. One lakh each imposed on the applicants, which were initially upheld by the Commissioner (Appeals) in response to the Revenue's appeal. The appellants had challenged the penalties before the Commissioner (Appeals), resulting in the penalties being set aside in an earlier order. However, in a subsequent disposition of the Revenue's appeals, the penalties were reinstated without considering the earlier order setting them aside. This discrepancy led to the present appeal.

Upon review, the Tribunal noted that the penalties had been previously set aside by the Commissioner (Appeals) in an order dated 20th December 2007, which had not been contested by the Revenue before the Tribunal. Consequently, the Tribunal deemed the subsequent order of the Commissioner (Appeals) upholding the penalties as illegitimate. As a result, the Tribunal concluded that the appeals should be allowed, dispensing with the pre-deposit condition for the two appellants in question. The stay petition and appeals were thus disposed of accordingly, with the Tribunal finding in favor of the appellants based on the legal inconsistency in upholding the penalties in the subsequent order without considering the prior decision.

The judgment, delivered by Ms. Archana Wadhwa, highlights the importance of adherence to legal procedures and the need for consistency in decisions, emphasizing that subsequent orders should not contradict earlier decisions that have not been challenged. The resolution of the appeals in favor of the appellants underscores the significance of due process and the proper application of legal principles in adjudicating matters related to penalties and appeals in the context of tax disputes.