2024 (1) TMI 771 - AT - Central Excise

Penalty under Rules 26 27 of Central Excise Rules, 2002 - evasion of Central Excise duty - whether the co-noticees stand to lose the substantial benefit of settlement under the SVLDR Scheme due to the fact that they have not applied for the Scheme whereas the main noticee has settled the case under SVLDR Scheme? - HELD THAT - The issue is no longer res integra having been decided by various benches of the Tribunal. This Bench in 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 where it was held that the benefit of the Scheme cannot be denied to the appellants just because they did not file the declaration under SVLDR Scheme. The appeal is allowed.

Summary

Issues involved: Penalty imposed under Rules 26 & 27 of Central Excise Rules, 2002; Benefit of settlement under SVLDR Scheme; Filing of declaration under SVLDR Scheme.

Penalty Imposed under Central Excise Rules:
The appellants filed an appeal against the penalty imposed on them for allegedly conniving with another party in evading Central Excise duty. The main noticee settled the case under the SVLDR Scheme, but the appellants did not approach the competent authority for settlement. The issue was whether the co-noticees lose the benefit of settlement under the SVLDR Scheme by not applying for it.

Benefit of Settlement under SVLDR Scheme:
The Tribunal found that each appellant needed to file a declaration under the SVLDR Scheme to avail of the relief provided. The relief under the Scheme, as per Section 124, included the entire penalty or late fee. The filing of the declaration was deemed a procedural formality, and the relief was not subject to the satisfaction of a committee. The Tribunal held that the benefit of the Scheme could not be denied to the appellants for not filing the declaration, especially when only penalty was involved.

Conclusion:
The Tribunal allowed the appeal, stating that the benefit of the SVLDR Scheme could not be denied to the appellants for not filing the declaration. The impugned order imposing penalty on the appellants was not sustained on merits. Therefore, all the appeals were allowed, and the penalty was waived for the appellants.