2018 (2) TMI 538 - AT - Central Excise

Demand of duty and penalty u/s 11AC - Held that - Adjudicating authority has analyzed the entire allegations made in the SCN in considerable detail. He has taken note of the findings of the results of the cross examination held on 4.2.2009, 19.2.2009 and 26.2.2009. Based on the analysis of same, detailed findings have been arrived in paras 55-67 of the impugned order. Only based on these findings, has the adjudicating authority justified the reduced demand of duty of ₹ 32,17,912/- and imposed penalty of ₹ 32,82,270/- under Section 11AC of the Central Excise Act on the assessee. The penalty of ₹ 1 lakh imposed on the Managing Director of the appellant appears to be commensurate with the reduced demand of duty confirmed by the Commissioner.

Summary

Issues:
1. Dismissal of appeals for non-prosecution due to withdrawal of appearance by the advocate.
2. Department's appeal against the decision regarding demand of duty and penalty imposed on the Managing Director.
3. Analysis of evidence and findings by the adjudicating authority.
4. Justification of reduced demand of duty and penalty imposed.

Issue 1 - Dismissal of appeals for non-prosecution:
The advocate representing the appellant withdrew his appearance as he had no instructions to pursue the appeals, citing that the appellant-company had been taken over by Axis Bank. The Tribunal issued notices to both the appellant-assessee and the counsel. As there was no appearance, the appeal Nos.E/479-480/2009 filed by the assessees were dismissed for non-prosecution.

Issue 2 - Department's appeal against demand of duty and penalty:
The department filed appeal Nos.E/528, 529/2009 against M/s. D.S. Metals Pvt. Ltd. and the Managing Director, challenging the adjudicating authority's decision to restrict the demand of duty and the penalty imposed. The department contended that the reasons given by the adjudicating authority were not legally sound, and crucial evidence like pocket diaries had been wrongly disregarded. It was argued that the Managing Director was the mastermind behind the offences, and the penalty imposed was inadequate considering the gravity of the offense.

Issue 3 - Analysis of evidence and findings:
The Tribunal reviewed the facts and records of the case and acknowledged the detailed analysis conducted by the adjudicating authority. The authority had examined the allegations in the show cause notice, considered the results of cross-examinations, and provided detailed findings in the impugned order. Based on this analysis, the authority justified the reduced demand of duty and the penalty imposed on the assessee and the Managing Director.

Issue 4 - Justification of reduced demand and penalty:
After careful consideration, the Tribunal found no reason to interfere with the impugned order. The reduced demand of duty and the penalty imposed on the Managing Director were deemed commensurate with the findings and conclusions drawn by the adjudicating authority. Consequently, both appeals filed by the department were dismissed for lacking merit, and the cross objections filed by the assessee were disposed of accordingly.

In conclusion, the appeals were disposed of as per the above terms, and the decision was dictated and pronounced in court.