2018 (3) TMI 1047 - AT - Central Excise

Employee of 100% EOU - signing the documents of 100% EOU which indulged in mis-using the EOU scheme and diversion of the goods in domestic market - Held that - the appellant is merely an employee and the issue on merits in respect of the company involved is of various provisions of 100% EOU and interpretation of overall EOU. It cannot be expected from an employee of the company to understand the entire provisions of EOU - penalty of 1 lakhs imposed on the appellant is harsh. Therefore the same deserve reduction - penalty reduced to 10000/- - appeal allowed in part.

Summary

Issues:
Employee's liability for misuse of EOU scheme and diversion of goods without duty payment.

Analysis:
The appellant, an employee of a 100% EOU, was found to have signed documents related to the misuse of the EOU scheme and diversion of goods in the domestic market without duty payment. The appellant claimed innocence, stating that he was merely following instructions and not benefiting from any wrongdoing. He argued that he was discharging his duties as an officer of the company and relied on previous tribunal judgments to support his case. The Revenue, represented by the Additional Commissioner, reiterated the findings of the impugned order.

Upon careful consideration of the submissions, the Tribunal acknowledged that the appellant was an employee and might not have had a comprehensive understanding of the EOU provisions. However, the Tribunal noted that the appellant had indeed signed the documents in question. Considering the overall circumstances and the appellant's role, the Tribunal found the penalty of ?1 lakh imposed on the appellant to be harsh. Therefore, the Tribunal decided to reduce the penalty to ?10,000, stating that the original penalty was excessive given the appellant's position and limited understanding of the EOU provisions.

In conclusion, the Tribunal partially allowed the appeal by reducing the penalty imposed on the appellant from ?1 lakh to ?10,000.