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TMI Blog2014 (5) TMI 976X X X X Extracts X X X X X X X X Extracts X X X X ..... to be treated as having been filed against the Order-in-Original and it may not be appropriate to deny and reject the appeals on this ground. whether the Commissioner is right in taking a view that there is no need for him to reconsider the issue of penalties imposed on the appellants on the ground that all the three appellants are juristic persons - Held that:- there cannot be separate penalty or demand for duty on the firm and the proprietor. That being the legal position at least in the case of Chirag, the observation of the Commissioner that the penalty was imposed on a juristic person and therefore he was not required to reconsider the same is not correct. Therefore on this ground, the Commissioner has to be directed to reconsider the penalty imposed on Chirag and for this purpose; the matter is required to be remanded to the original adjudicating authority. As regards the other two appeals of Chiramith and Tavadec, one is a partnership firm and the other is private limited company and therefore both are to be considered as separate legal entities/juristic persons and in this regard I find that the discussion of the case law by the Commissioner in the impugned order and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... impugned order has considered the quantum of redemption fine and has reduced the same from Rs.25 lakhs originally imposed to Rs.12 lakhs after giving the depreciation for the use of the machineries and also has taken a view that since it is nearly 20 years since the machines were imported, it would not be possible to arrive at the market value. 3. Chiramith is contesting the redemption fine on the ground that it is too harsh and Commissioner has not implemented the order of the Hon ble High Court to determine the redemption fine on the basis of market value. 4. The Commissioner, while undertaking fresh de novo adjudication, has taken the view that the direction of the Hon ble High Court to him was to redetermine the personal penalty. According to him, personal penalty means, penalties imposed on individual persons and after considering the submissions of the appellants and analyzing certain decided cases, he has come to the conclusion that personal liability would not include penalties imposed on juristic persons and the three appellants who are before me today are juristic persons and therefore the penalty imposed on them was not required to be reconsidered and therefore he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Department has not made any mistake in enforcing the demand for personal penalties imposed as per the order dt. 10/12/1999 and the appellants should have mentioned Order-in-Original as the order under challenge and not the letter of the Superintendent. 6. I have considered the submissions. In my opinion, there was an omission on the part of the Registry also. After noticing that the appeals were filed against the Superintendent s letter, the Registry should have pointed out the same as a defect and in such an event, if the appellants were to mention the Order-in-Original and filed a revised appeal, in the normal course the same would have been accepted. Therefore, I do not consider that this is not rectifiable defect and after considering the stay applications and there appeals, it is quite clearly seen that the appellants have brought out that they are aggrieved by the decision in the Order-in-Original which had not reconsidered the penalties imposed on them and the sum and substance of the appeals is reconsideration of the penalties and redemption fine and therefore it would be in the interest of justice that the appeal has to be treated as having been filed against the Order- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gh the order of the Tribunal passed on the earlier occasion, it was found that Chirag is a proprietary firm and Mrs. Jyothi Ramachandra was the proprietor. In the case of a proprietary firm, it is settled law that there cannot be separate penalty or demand for duty on the firm and the proprietor. That being the legal position at least in the case of Chirag, the observation of the Commissioner that the penalty was imposed on a juristic person and therefore he was not required to reconsider the same is not correct. Therefore on this ground, the Commissioner has to be directed to reconsider the penalty imposed on Chirag and for this purpose; the matter is required to be remanded to the original adjudicating authority. 10. As regards the other two appeals of Chiramith and Tavadec, one is a partnership firm and the other is private limited company and therefore both are to be considered as separate legal entities/juristic persons and in this regard I find that the discussion of the case law by the Commissioner in the impugned order and his conclusion that penalties on the partners/directors is separate from the penalty on the company is appropriate. However, I am handicapped by the f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... If that is the case, the whole decision would have been taken as relating to only Chiramith, which, in my opinion, would not be proper since there is no finding or observation that there were different counsels for the parties and all the respondents were represented by a single counsel and there is no conflict of interest between the appellants also. In these circumstances, the only conclusion that can be reached as regards submission is that the submissions were made on behalf of the assessees/respondents. It is clear from Para 22 that the request by the appellant was that if at all the Court were to uphold the order of the Commissioner, the matter has to be remanded back for calculating duty and penalty and therefore no case for interference has been made out . The assessee and others could not have been requesting for reconsideration of penalty only in respect of individuals and there is no rejection of the claim for reconsideration of redemption fine and penalties. In fact such a claim has been accepted and Hon ble court has given specific directions as regards redemption fine and therefore it may not be correct to read the order hyper technically to deny the request for re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itted that the above plea was not raised even before the original adjudicating authority at the first instance and she also submits that Chirag and Tavadec have submitted their replies to the show-cause notice which itself would show that they themselves had felt that they are liable to penalty and it was an issue before the original adjudicating authority. The learned counsel was requested as to whether this issue was raised before the original authority or not in the reply to the show-cause notice. He could not show that such a plea was raised. In any case, the learned counsel submits that even if this issue was not raised in the first round of litigation up to the stage of Hon ble High Court, being a point of law, it can be raised at any stage. In my opinion, this may not be an appropriate stand to take. The question as to whether a show-cause notice required an assessee to show-cause or not is not only a question of law and but also a question of fact. The fact that the show-cause notice was issued requiring a person to show-cause against is always a question of fact and whether without a show-cause notice a person can be imposed penalty or not is a question of law. Therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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