2013 (5) TMI 3 - HC - Central Excise

Application for waiver partly allowed - Held that - Appellant No. 1 has been given the benefit of waiver of pre-deposit of the duty amount. The transactions of the other appellants have been found to be bogus, therefore, the order passed by the Tribunal calling upon the other appellants to deposit 50% of the duty imposed and 10% of the penalty against some of the other appellants cannot be said to be suffering from any patent illegality giving rise to any substantial question of law.

Summary

Issues:
- Appeal under Section 35-G of the Central Excise Act, 1944 arising from an order of the Customs, Excise & Service Tax Appellate Tribunal regarding duty evasion and penalties.
- Waiver of pre-deposit of duty amount for one appellant but not for others.
- Allegations of bogus transactions leading to duty evasion and penalties.
- Arguments regarding complete waiver of duty and penalties based on Cenvat Credit reversal.

Analysis:

The judgment delivered by the High Court of PUNJAB & HARYANA pertained to an appeal under Section 35-G of the Central Excise Act, 1944, arising from an order of the Customs, Excise & Service Tax Appellate Tribunal. The Tribunal had partly allowed an application for waiver of pre-deposit of duty amount for the appellants involved in the case. The original order by the Commissioner of Central Excise had found transactions of M/s Windsor Exports Limited to be bogus, resulting in duty evasion amounting to Rs. 59,72,519. Penalties were imposed on multiple firms involved in the transactions. However, the Tribunal waived the duty demand for M/s Windsor Exports Limited but directed other appellants to deposit 50% of the Cenvat Credit demand and 10% of the penalty amount.

The appellant argued that the duty and penalties should be completely waived based on the reversal of Cenvat Credit availed by M/s Windsor Exports Limited. The High Court, after hearing arguments from both parties, found no merit in the appeal. It noted that while the first appellant had been granted a waiver of pre-deposit of duty amount, transactions of the other appellants were deemed bogus. Therefore, the order of the Tribunal directing the other appellants to deposit a portion of the duty and penalties was upheld, as it was not found to be suffering from any patent illegality or substantial question of law.

In conclusion, the High Court dismissed the appeal, affirming the decision of the Tribunal regarding the waiver of duty amount for one appellant but not for the others involved in the case. The allegations of bogus transactions leading to duty evasion and penalties were considered, and the argument for complete waiver based on Cenvat Credit reversal was not accepted by the Court.