Tribunal upholds confiscation but sets aside separate penalty, partially allowing appeal

Sethu Match industries Versus Commissioner of Central Excise, Madurai

Sethu Match industries Versus Commissioner of Central Excise, Madurai - 2013 (292) E.L.T. 85 (Tri. - Bang.) Issues: Confiscation of goods, redemption fine, penalty imposition, Settlement Commission's order

Confiscation of Goods:
The impugned order confiscated the goods and imposed a redemption fine, which had already been paid by the appellants. The consultant for the appellants clarified that they do not contest the redemption fine. However, there was a penalty of Rs.74,254/- imposed under the impugned order. The duty amount for the impugned consignment was included in another show cause notice (SCN) dated 2.11.2010, and the matter was settled by the Settlement Commission's order dated 18.5.2012, imposing a penalty of Rs.1,50,000/- for other clearances and the goods subject to confiscation in the impugned order. The consultant argued that there was no ground for sustaining a separate penalty under the impugned order and requested its setting aside.

Redemption Fine and Penalty Imposition:
The consultant for the appellants stated that the impugned order imposed a redemption fine that had already been paid by the appellants, and they did not wish to contest it. Additionally, a penalty of Rs.74,254/- was imposed under the impugned order. The duty amount for the impugned consignment was part of another SCN dated 2.11.2010, and the matter was resolved by the Settlement Commission's order dated 18.5.2012, which imposed a penalty of Rs.1,50,000/- for previous clearances and the goods under confiscation in the impugned order. The consultant argued that a separate penalty under the impugned order was unjustified, considering the penalty already determined by the Settlement Commission. The consultant requested the setting aside of the penalty separately imposed under the impugned order.

Settlement Commission's Order:
The Settlement Commission's order, dated 18.5.2012, imposed a consolidated penalty for past clearances and the impugned consignment after the appellants admitted their duty liability. The appellate tribunal noted that the Settlement Commission's order was not available before the lower appellate authority during the initial proceedings since the appellants had not approached the Settlement Commission at that time. The tribunal found it peculiar that confiscation and penalty for the impugned goods were addressed separately from the duty demanded under another SCN covering previous clandestine clearances. Despite this, the tribunal held that a separate penalty under the impugned order could not be sustained, given the penalty already imposed by the Settlement Commission. Consequently, the tribunal upheld the confiscation and redemption fine while setting aside the separately imposed penalty under the impugned order, partially allowing the appeal.

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