2017 (11) TMI 1782 - AT - Central Excise

Misuse of Area Based Exemption by M/s. Jammu Pigments Pvt. Ltd. - confiscation - immunity from penalty - Held that - The Settlement Commission has levied the penalty of Rs. one lakh on the main appellant and ₹ 25,000/- each on co-appellants No. 1 & 2, under the provisions invoked in the Show Cause Notice and grants them immunity from penalty in excess of the above amount - The Settlement Commission further observed that the above immunity to the applicant are granted under sub-section (1) of Section 32K of the Act. Attention of the applicant is also drawn to the provisions of sub-sections (2) and (3) of Section 32K of the Act. As stated the appellant, Shri R.P. Agrawal is the applicant No. 2 before the Settlement Commission who was penalised with the penalty of ₹ 25,000/-. Further, immunity was granted by the Settlement Commission. When it is so, then the assessee-appellant is not entitled for double jeopardy and he cannot be punished twice for the same offence - there are no justification to sustain the impugned order - appeal allowed.

Summary

Issues: Misuse of Area Based Exemption, Penalty Imposition, Settlement Commission's Decision, Double Jeopardy

Misuse of Area Based Exemption:
The case involves the misuse of Area Based Exemption by a company issuing invoices without supplying goods. The Department initiated proceedings against the company and another party when it was discovered that no goods were supplied against the invoices issued. The Tribunal noted the findings against the company and the penalty imposed by the Settlement Commission on the main appellant and co-appellants for evasion of excise duty related to the invoices issued.

Penalty Imposition:
The Settlement Commission, after considering the case, levied a penalty on the main appellant and co-appellants for their involvement in the evasion of excise duty. The penalty amount was specified for each party, and immunity from penalty in excess of the specified amount was granted. The Tribunal acknowledged the penalty imposed by the Settlement Commission and considered the immunity granted in its decision.

Settlement Commission's Decision:
The Settlement Commission's order specified the duty liability and penalties for the appellant and co-appellants involved in the evasion of excise duty. It granted immunity to the applicants under specific provisions of the Act, highlighting the penalty amounts imposed and the immunity granted to the appellant before the Settlement Commission. The Tribunal reviewed the Settlement Commission's decision and its implications on the present appeal.

Double Jeopardy:
The Tribunal considered the principle of double jeopardy, emphasizing that the appellant cannot be punished twice for the same offense. It concluded that since the penalty was already imposed by the Settlement Commission, the appellant was not entitled to face double punishment. Consequently, the Tribunal allowed the appeal filed by the appellant, finding no justification to sustain the impugned order.

This detailed analysis of the judgment highlights the issues of misuse of Area Based Exemption, penalty imposition, the Settlement Commission's decision, and the principle of double jeopardy, providing a comprehensive overview of the legal proceedings and the Tribunal's final decision.