2014 (6) TMI 645 - AT - Customs

Enhancement of penalty imposed - - Held that - Revenue has failed to bring the fact that the appellant s appeal quo imposing penalty has been allowed by setting aside the order of imposing penalty to the knowledge of the Commissioner (Appeals) and the Commissioner (Appeals) passed the impugned order. When the department has accepted that no penalty is warranted on the appellants in this matter, therefore, the question of enhancement of penalty does not arise at all. - Decided in favour of assessee.

Summary

Issues:
1. Delay condonation
2. Enhancement of penalty

Delay Condonation:
The judgment begins with the condonation of delay as the reason causing the delay has been satisfactorily explained. The appellant's appeal before the Commissioner (Appeals) partially set aside the adjudication order, which was accepted by the department. However, the Revenue filed an appeal for enhancement of penalties. The Commissioner (Appeals) enhanced the penalty imposed on the appellant, which the appellant contested. The department failed to inform the Commissioner (Appeals) that the appellant's appeal against penalty imposition had been partially allowed. The Tribunal found that since the department accepted that no penalty was warranted, the question of enhancing the penalty did not arise. The case law cited by the Revenue was deemed irrelevant as it did not align with the facts of this case. Consequently, the impugned order was set aside, and the appeals were allowed.

Enhancement of Penalty:
The learned Advocate for the appellant argued that the impugned order regarding the enhancement of penalty should be set aside since the department had accepted that no penalty was warranted. On the contrary, the learned Additional Commissioner supported the impugned order for enhancement of penalty, contending that the waiver of penalty in the appellant's appeal had not been merged. The Tribunal considered both sides' submissions and highlighted that the Commissioner (Appeals) had set aside the order imposing penalty on the appellant. The Tribunal emphasized that since the penalty was not warranted at all, the question of enhancing the penalty did not arise. The Tribunal differentiated this case from the case law cited by the Revenue, emphasizing the unique circumstances of this case. Consequently, the impugned order was deemed to have no merit and was set aside, with the appeals being allowed, and the stay application disposed of accordingly.