2013 (12) TMI 339 - AT - Central Excise

Penalty under Rule 25 of the Central Excise Rules, 2002 Clandestine removal of chakdo rickshaws Whether is appellant is job worker or not for M/s. Raj Auto Industries Waiver of pre-deposit Held that - The appellant has been penalised under Rule 25 of the Central Excise Rules, 2002 - the appellant is a job worker and is also holding a central excise registration as a manufacturer and cleared three-wheel vehicles on payment of central excise duty - In the absence of any demand of the duty from the appellant, it is not understandable how the penal provisions under Rule 25 can be fastened on the appellant and he be penalised under violation of the provisions of the Central Excise Act - the appellant has made out a prima facie case for the waiver of pre-deposit of the amounts involved Pre-deposits waived till the disposal Stay granted.

Summary

Issues:
1. Penalization under Rule 25 of the Central Excise Rules, 2002 for manufacturing/assembling chakdo rickshaws.
2. Appellant's status as a job worker for M/s. Raj Auto Industries.
3. Prima facie case for the waiver of pre-deposit of penalty amount.

Analysis:

1. The judgment revolves around the penalization of the appellant under Rule 25 of the Central Excise Rules, 2002 for manufacturing/assembling chakdo rickshaws. The appellant had manufactured/assembled these rickshaws for M/s. Atithi Gokul Automobiles Works, who allegedly cleared them clandestinely, resulting in a demand confirmed against them. The appellant was penalized under Rule 25, with the argument that he was not a job worker for M/s. Raj Auto Industries. However, the tribunal found that the appellant is indeed a job worker for M/s. Raj Auto Industries and holds a central excise registration as a manufacturer, clearing three-wheel vehicles on payment of central excise duty. The tribunal noted that in the absence of any demand of duty from the appellant, penal provisions under Rule 25 could not be applied, leading to the waiver of pre-deposit of the penalty amount.

2. The second issue addressed in the judgment pertains to the appellant's status as a job worker for M/s. Raj Auto Industries. The tribunal examined the records and confirmed that the appellant is indeed a job worker for M/s. Raj Auto Industries, holding a central excise registration as a manufacturer. This finding was crucial in determining the applicability of penal provisions under Rule 25 and the subsequent decision to waive the pre-deposit of the penalty amount.

3. Lastly, the tribunal considered whether the appellant had made out a prima facie case for the waiver of pre-deposit of the penalty amount. After reviewing the submissions made by the ld. D.R., perusing the stay petition, and examining the grounds of appeal in the memoranda, the tribunal concluded that the appellant had indeed established a prima facie case for the waiver of the penalty amount. Consequently, the application for the waiver of the penalty amount was allowed, and the recovery thereof on the penalty imposed was stayed until the disposal of the appeal.

In conclusion, the judgment by the Appellate Tribunal CESTAT AHMEDABAD addressed the issues of penalization under Rule 25, the appellant's status as a job worker, and the prima facie case for the waiver of pre-deposit of the penalty amount, ultimately ruling in favor of the appellant based on the presented facts and legal provisions.