2015 (10) TMI 910 - AT - Central Excise

Imposition of penalty under Rule 209A - Held that - In the first case, a penalty of ₹ 5 lakhs each was imposed on Shri Shrikant Sitaram Maniyar and the present appellant. The present appellant being the chief executive officer cannot absolve himself of the responsibility. We have also gone through the said judgment of the Tribunal and keeping in view the fact that the penalty on Shri Shrikant Sitaram Maniyar was reduced to ₹ 2 lakhs, we reduce the penalty on the present appellant to ₹ 1,75,000/-. Barring this modification in penalty, the appeal is dismissed. - decided against assessee.

Summary

Issues:
1. Imposition of penalty under Rule 209A of the Central Excise Rules, 1944 in two separate cases.
2. Appellant's liability as the chief executive officer.
3. Reduction of penalties based on previous Tribunal orders.
4. Remand of the second case and its impact on the penalty.

Analysis:

Issue 1: Imposition of penalty under Rule 209A
The judgment involves two appeals filed against the imposition of penalties under Rule 209A of the Central Excise Rules, 1944. The penalties in question were imposed on the appellant in two separate cases covered by specific order-in-original references.

Issue 2: Appellant's liability as the chief executive officer
The appellant, identified as the chief executive officer, argued that despite being named as such, he was primarily responsible for sales and export work, not central excise matters. The appellant contended that the penalties imposed should consider his role and level of involvement in the alleged manipulations. The Appellate Tribunal acknowledged the appellant's position but emphasized that as the chief executive officer, he could not absolve himself of responsibility for ensuring correct tax payments.

Issue 3: Reduction of penalties based on previous Tribunal orders
In the first case, the Tribunal noted that penalties of Rs. 5 lakhs each were imposed on the main beneficiary and the present appellant. Citing a previous Tribunal judgment that reduced the penalty on the main beneficiary to Rs. 2 lakhs, the Tribunal reduced the penalty on the present appellant to Rs. 1,75,000. The Tribunal considered the nature of the manipulations and upheld the modified penalty while dismissing the appeal.

Issue 4: Remand of the second case and penalty impact
Regarding the second case, the appellant mentioned that the main case had been remanded, and the appellant was unaware of subsequent developments. The Tribunal observed that the appellant did not raise these points during the remand process in the main case. Despite the lack of clarity on the main case's status, the Tribunal imposed a personal penalty of Rs. 25,000 on the present appellant, considering the nature of the dispute. The Tribunal upheld this modified penalty while dismissing the second appeal.

This comprehensive analysis of the judgment highlights the key issues, arguments presented, Tribunal's considerations, and the final decisions rendered in each case.