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of <h1>Tribunal and High Court Uphold Duty Liability Separation, No Joint Penalties Allowed</h1> <h3>RIMJHIM ISPAT LTD. Versus COMMISSIONER OF CENTRAL EXCISE, KANPUR</h3> RIMJHIM ISPAT LTD. Versus COMMISSIONER OF CENTRAL EXCISE, KANPUR - 2013 (293) E.L.T. 124 (Tri. - Del.) Issues:Confirmation of duty against multiple entities jointly and severally, imposition of penalties without segregation of amounts, liability to be fixed separately for each individual, applicability of previous tribunal decisions, segregation of duty liability against different individuals, relatedness of manufacturing units, lifting of corporate veil, clandestine removal of goods, legal implications of joint demands and penalties.Analysis:The judgment in question pertains to the confirmation of duty against two entities jointly and severally, without segregating the amount confirmed against each of them and imposing penalties collectively on both manufacturing units. The advocate raised a preliminary issue citing a previous Tribunal decision emphasizing that the liability of each assessee should be fixed separately. The Tribunal set aside the impugned orders and remanded the matters for fresh decision, stressing the need to segregate individual duty liability against different individuals. The Tribunal also highlighted that joint demands and penalties against various persons are not in accordance with the law.The Revenue challenged the Tribunal's decision before the High Court, which was subsequently dismissed. The Mumbai Bench of the Tribunal further clarified that duty liability should be segregated separately against each individual, and joint demands cannot be upheld. Various Tribunal decisions were referenced to support the segregation of duty liability against different individuals and not demanding duty from two different persons for the same goods.The Revenue argued that the two manufacturing units were operated by the same family members, making it difficult to segregate the demand against each unit separately. However, the Tribunal emphasized that the issue was not about lifting the corporate veil but about clandestine removal against two distinct manufacturing units. The Tribunal noted that previous decisions did not permit the confirmation of duty jointly and severally against two different legal entities manufacturing different products.Given the precedents and legal principles cited, the Tribunal set aside the impugned order and remanded the matter for the adjudicating authority to fix the liability of each individual separately. The parties were allowed to raise all legal issues, including evidence appreciation and cross-examination, in the fresh proceedings. All appeals were disposed of accordingly.
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