2011 (4) TMI 897 - AT - Central Excise

Tribunal Upholds Excise Penalties: Compliance Emphasized, Appeals Dismissed

CCE, Delhi-IV, Faridabad Versus M/s. Metal Formers & Others

CCE, Delhi-IV, Faridabad Versus M/s. Metal Formers & Others - TMI Issues:1. Appeal by the department against the order of the Commissioner (Appeals) and connected cross objection.2. Appeal challenging penalty imposition sustained by the Commissioner (Appeals).Analysis:Issue 1: Appeal by the department and connected cross objectionThe appeal by the department was against the order of the Commissioner (Appeals) regarding the confiscation of goods and imposition of penalties. The respondent firm, a proprietary concern, claimed a partnership was constituted with one of the partners being the authorized signatory. The premises were shifted to another location, leading to the removal of finished goods, raw materials, and machinery. The original authority confiscated goods and imposed penalties under various rules. On appeal, the Commissioner (Appeals) upheld confiscation but reduced the redemption fine and penalties imposed. The department argued that penalties should not have been reduced, citing a Supreme Court decision. The respondent contended that the change in premises and firm constitution was duly intimated, justifying no penalties. The Tribunal found no evidence of intimation to excise authorities and upheld confiscation due to violations of Cenvat Credit Rules. The Commissioner's reduction of penalties was deemed reasonable, and the cross objection challenging confiscation and penalties was dismissed.Issue 2: Appeal challenging penalty impositionThe second appeal was by an individual challenging the penalty imposed and sustained by the Commissioner (Appeals). The appellant was the authorized signatory of the firm and a partner in another entity dealing with the confiscated goods. The Tribunal affirmed that penalties were warranted as the removal of goods without duty payment and credit reversal violated Cenvat Credit Rules. The penalty on the appellant was considered justified, and the Commissioner's decision to reduce penalties was deemed appropriate. Consequently, the appeal seeking to set aside the penalty was rejected.In conclusion, the Tribunal rejected the department's appeal, dismissed the cross objection by the respondent firm, and rejected the appeal challenging the penalty imposition. The decision emphasized compliance with excise rules and upheld penalties for violations, maintaining the Commissioner (Appeals)'s reduced penalties as reasonable in the circumstances.