2014 (9) TMI 1053 - AT - Central Excise

Appeal Dismissed: Tribunal Upholds Rs. 4 Lakh Penalty for Tax Violations

Tosha International Ltd. Versus Commissioner of Customs, New Delhi

The appeal was dismissed as the penalty imposed was deemed lawful and proper by the Tribunal, based on the facts and circumstances of the case. The ... Imposition of penalty - travelled beyond the scope of remand order of CESTAT - no differential duty arose as a result of de novo proceedings - Held that:- CESTAT nowhere stated that the penalty would be imposable only on the basis of the amount of differential duty. Indeed, it clearly stated that the penalty would depend on the consideration of the relevant factors. Thus the appellants’ contention is not tenable as the same is not based on the correct reading of the said CESTAT judgment. Further, it is found that the adjudicating authority in the impugned order has discussed the issue of imposability of penalty in the given facts and circumstances of the case and come to the finding that the appellants had been wrongly deducting the sales tax which was collected by them but not paid to the State Government and found the said conduct of theirs deserving of penalty of the amount imposed in the said order. - Decided against the appellant Issues:Penalty imposition based on remand order scope and differential duty consideration.Analysis:The appeal was filed against an Order-in-Original imposing a penalty of Rs. 4 lakhs, contending that the penalty exceeded the scope of the remand order by not considering any differential duty resulting from de novo proceedings. The Hon'ble CESTAT's Final Order stated that penalty quantification depends on various factors, not solely on differential duty. The appellants' argument was deemed invalid as the CESTAT did not limit penalty imposition to differential duty amount. The adjudicating authority found the appellants at fault for wrongly deducting sales tax collected but not remitted to the State Government, justifying the penalty imposed.The Tribunal reviewed the CESTAT's judgment and concluded that the penalty was correctly imposed based on the facts and circumstances of the case. The impugned order was deemed lawful and proper, with no deficiencies noted. Consequently, the appeal was dismissed.