2024 (5) TMI 1335 - AT - Central Excise

Levy of penalty on other co-noticee - Clandestine manufacture and clearance of the finished goods - whether after acceptance of application of the main applicant under SVLDRS, 2019 regarding the duty liability and penalty imposed, the personal penalty imposed on other notices can survive? - HELD THAT - This issue has been dealt by the Tribunal in the case of M/S JPFL FILMS PRIVATE LIMITED, JALAN JEE POLYTEX LTD., KAVITA INTERNATIONAL AGENCY, KULDEEP SINGH, DP SINGH, R KNITFAB, PERFECT DESIGNER, VK KALRA, RELIANCE INDUSTRIES LIMITED, KANPUR WOOL INDUSTRIES, SWASTIK TRADING CO., APEX CORPORATION AND MANSA TRADERS VERSUS COMMISSIONER OF CENTRAL EXCISE, LUDHIANA 2023 (12) TMI 304 - CESTAT CHANDIGARH has held that ' the benefit of the Scheme cannot be denied to the appellants just because they did not file the declaration under SVLDR Scheme.' There are no reason not to follow the aforesaid precedent of this Tribunal. Consequently, the appeal filed by the appellant deserves to be allowed and accordingly the same is allowed.

Summary

Issues involved: Appeal against Order-in-Appeal alleging clandestine manufacture and clearance of goods without duty payment, imposition of penalty on Plant Manager u/r 25 of Central Excise Rules, 2002, applicability of Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 on personal penalties post main applicant's settlement.

Summary:
The appeal was filed against Order-in-Appeal alleging clandestine activities and imposition of penalties. The appellant, a Plant Manager, was penalized under Rule 25 of Central Excise Rules, 2002. The company applied under Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019, and the application was accepted, resulting in the dismissal of the company's appeal. The appellant argued for similar treatment based on precedents like JPFL Films Private Limited & others Vs. CCE, Ludhiana. The Revenue supported the findings of the Commissioner(Appeals).

The main issue was whether personal penalties could survive after the main applicant settled under SVLDRS, 2019. The Tribunal analyzed the Scheme's provisions and observed that each appellant needed to file a declaration separately. The relief under the Scheme was automatic for penalty or late fee, not subject to committee satisfaction. The Tribunal held that procedural issues should not impede substantial rights, citing previous cases where penalties were waived post-main party discharge.

In conclusion, the Tribunal allowed the appeals, stating that the Scheme's benefits could not be denied for failure to file declarations. The impugned order was not sustained on merits regarding penalty imposition. The decision was in line with previous Tribunal precedents, and the appeal was allowed accordingly.

The judgment was pronounced in Open Court on 22.05.2024.