2011 (9) TMI 869 - AT - Central Excise

Modification of Final Order - Setting aside of penalty order not mentioned in final order - allegation of suppression of facts attracting the larger period for demand of duty was held not sustainable - Held that - The final order passed by this bench indicates that the penalty-related issue was not debated, nor in fact was it open to debate. This was because the findings of the learned Commissioner (Appeals) were correctly understood by the bench and it was clearly held that the assessee was not to be penalized where the allegation of suppression of facts, levelled against them, was set aside by the Commissioner (Appeals) and that view was not appealed against by the Revenue. Learned Commissioner (Appeals) had clearly held that the allegation of suppression of facts was not sustainable in the facts and circumstances of the case and he did not direct the lower authority to impose any penalty on them consequent upon requantification of duty demand - Modification allowed.

Summary

Issues:
1. Modification of Final Order No. 1298/2010 regarding penalty imposition.

Analysis:
The appellant sought a modification of Final Order No. 1298/2010, which did not address a prayer in the memo of appeal regarding setting aside a demand and penalty. The appellant argued that no penalty was ordered as the allegation of suppression of facts was deemed unsustainable by the lower appellate authority. The Tribunal, after reviewing the records and submissions, agreed that the penalty issue was not open for debate as the Commissioner (Appeals) had already ruled in favor of the assessee, stating that no penalty should be imposed. The Tribunal upheld this decision and directed the original authority to only requantify the duty demand, emphasizing that the penalty-related issue was settled.

The appellant, despite the favorable findings of the Commissioner (Appeals), expressed doubt about the penalty imposition under Section 11AC of the Central Excise Act. To clarify the final order, the Tribunal decided to add a sentence stating that since the first appellate authority ruled in favor of the assessee regarding the penalty, there was no need for further discussion on the penalty issue. The Tribunal modified the final order to reflect this clarification, thereby addressing the appellant's doubt about the penalty imposition. Ultimately, the Tribunal allowed the application only to the extent of making the final order clearer regarding the penalty issue, ensuring that the appellant's concerns were addressed appropriately.