2024 (2) TMI 1189 - HC - Customs

Penalty imposed u/s 112(a) - Import confectionary items from Dubai - immunity from prosecution and fine/penalty - Tribunal held that since the appellant was a co-noticee along with M/s. A.K.S. Apparels and Mr. Nitin Gupta, appellant was also entitled to immunity granted by the Settlement Commission to the main noticee - HELD THAT - We are informed that a Special Leave Petition impugning the said judgment in M/s. Seville Products 2024 (1) TMI 686 - SC ORDER has been dismissed by the Hon ble Supreme Court. Thus, the impugned order passed by the Tribunal granting immunity to the respondent is set aside. The appeal of the respondent is restored on the records of the Tribunal. The matter is remitted to the Tribunal to decide the appeal filed by the respondent on merits in accordance with law. The appeal is accordingly disposed of in view of the above.

Summary

Issues involved:
The issues involved in this case are the granting of immunity by the Settlement Commission to co-noticees, the interpretation of liability of noticees in a case, and the applicability of a judgment by a Coordinate Bench of the High Court and the subsequent dismissal of a Special Leave Petition by the Supreme Court.

Granting of Immunity by Settlement Commission:
The Tribunal allowed the appeal of the respondent, who had impugned a penalty, based on the immunity granted by the Settlement Commission to other co-noticees. The Tribunal held that since the appellant was a co-noticee along with others who received immunity, the appellant was also entitled to the immunity. However, the High Court, referring to a judgment by a Coordinate Bench, emphasized that the discharge of liability of one noticee does not absolve other noticees from their liability. The Supreme Court also dismissed a Special Leave Petition challenging this judgment. Consequently, the High Court set aside the Tribunal's order granting immunity to the respondent and remitted the matter back to the Tribunal for a decision on the appeal filed by the respondent on its merits.

Liability of Noticees and Interpretation of Judgment:
The High Court referred to a judgment by a Coordinate Bench which held that the discharge of liability of one noticee does not release other noticees from their liability. The High Court emphasized that the reasoning of the Tribunal in extending immunity to the respondent based on the immunity granted to other co-noticees was not sustainable. The High Court, in view of the judgment by the Coordinate Bench and the dismissal of the Special Leave Petition by the Supreme Court, set aside the Tribunal's order granting immunity to the respondent and directed the Tribunal to decide the appeal on its merits in accordance with the law.

Disposition of the Appeal:
The High Court disposed of the appeal by setting aside the Tribunal's order granting immunity to the respondent and remitting the matter back to the Tribunal for a decision on the appeal filed by the respondent on its merits in accordance with the law.