2013 (12) TMI 217 - AT - Central Excise

Abetting and aiding clandestine removal Goods manufactured and cleared from their factory Waiver of Pre-deposit of Penalty under Rule 26 of Central Excise Rules, 2002 Held that - The statement of the appellant seems to be inappropriate Shri Mafatlal Harakchand Shah, has directed in a particular manner to remove the goods clandestinely - The defences taken needs to be gone into detail which can be done only at the time of final disposal of appeal - Prima-facie, the appellant has not made out prima facie case in their favour - Keeping in mind that the appellant is an individual and the unit M/s. Shriram Tubes Pvt. Limited is closed appellant is directed to submit Rupees one lakh as pre-deposit upon such submission rest of the duty to be stayed till the disposal Partial stay granted.

Summary

Issues:
Waiver of pre-deposit of penalty under Rule 26 of Central Excise Rules, 2002.

Analysis:
The appellant filed a stay petition seeking the waiver of pre-deposit of Rs. 20 Lakhs imposed as a penalty under Rule 26 of Central Excise Rules, 2002. The penalty was imposed for abetting and aiding another company in clandestine removal of goods. The appellant argued that their statement was not recorded in the case of the other company, implying they had no involvement. However, it was noted that the Director of the other company stated that the appellant had directed them to remove goods clandestinely. The Tribunal found that the appellant had not made out a case for complete waiver of the penalty. Considering the appellant's individual status and the closure of the company involved, the Tribunal directed the appellant to pre-deposit Rs. 1,00,000 within eight weeks and report compliance. Upon compliance, the application for waiver of the balance penalty amount was allowed, and recovery stayed pending the appeal's disposal.

This judgment primarily revolves around the issue of seeking a waiver of pre-deposit of penalty under Rule 26 of Central Excise Rules, 2002. The Tribunal carefully considered the arguments presented by both sides and examined the evidence on record, including statements from relevant individuals. The appellant's defense that their statement was not recorded in the case of the company they allegedly aided was countered by the Director of that company's statement, implicating the appellant in directing the clandestine removal of goods. The Tribunal acknowledged the need for a detailed examination of the evidence during the final disposal of the appeal. However, based on the prima facie assessment, the Tribunal found that the appellant had not established grounds for a complete waiver of the penalty. Consequently, a partial pre-deposit amount of Rs. 1,00,000 was directed to be made within a specified timeframe, with the waiver of the balance penalty amount subject to compliance and pending the appeal's final decision.

In conclusion, the judgment by the Appellate Tribunal CESTAT Ahmedabad addressed the issue of waiver of pre-deposit of penalty under Rule 26 of Central Excise Rules, 2002. The Tribunal carefully evaluated the arguments and evidence presented, ultimately directing the appellant to make a partial pre-deposit while allowing the waiver of the remaining penalty amount subject to compliance and pending the appeal's final disposal. The decision highlighted the importance of a detailed examination of evidence and legal points during the appeal process, emphasizing the need for compliance with the Tribunal's directives to benefit from the waiver granted.