Appeal allowed in CESTAT Kolkata rectifying unjust denial of duty credit & penalty imposition. The Appellate Tribunal CESTAT, Kolkata allowed the appeal in favor of the appellants, rectifying the unjust denial of credit of duty and penalty. The ...
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Appeal allowed in CESTAT Kolkata rectifying unjust denial of duty credit & penalty imposition.
The Appellate Tribunal CESTAT, Kolkata allowed the appeal in favor of the appellants, rectifying the unjust denial of credit of duty and penalty. The Tribunal emphasized that the denial of credit and penalty imposition on the appellants due to the peculiar procedure adopted by M/s SAIL was a gross miscarriage of justice. The lower appellate authority had already reduced the penalty on M/s SAIL, indicating leniency. The Tribunal set aside the impugned order, allowing the appellants to avail credit of duty and waiving the penalty imposed on them, ultimately correcting the situation not caused by them.
Issues: Denial of credit of duty and penalty due to a peculiar procedure adopted by M/s SAIL.
In this judgment by the Appellate Tribunal CESTAT, Kolkata, the issue at hand was the denial of credit of duty and imposition of a penalty on the appellants due to a peculiar procedure adopted by M/s SAIL. The Tribunal noted that the impugned goods were removed from the steel plant to a store in the town on payment of duty, and subsequently sold to the appellants under gate-passes issued from the store against a purchase order from the plant. The Tribunal observed that there was no question raised about the discharge of duty on the impugned consignment. It was highlighted that the denial of credit to the appellants was deemed a gross miscarriage of justice, as the peculiar procedure adopted by M/s SAIL had led to the situation. The lower appellate authority had already reduced the penalty imposed on M/s SAIL significantly, indicating a lenient view towards the situation. The Tribunal emphasized that had the steel plant not adopted the peculiar procedure and directly delivered the impugned goods to the appellants, there would have been no grounds for any action against the appellants.
The Tribunal further pointed out that the penalty imposed on the steel plant for the peculiar procedure was minimal, at Rs. 5,000 only. Therefore, it was deemed unjust to deny the appellants credit of Rs. 3,31,117 and impose an additional penalty of Rs. 5,000 on them for a situation that was not their fault. In the interest of justice, the impugned order was set aside, and the appellants were allowed to avail credit of duty while the penalty imposed on them was waived. Ultimately, the appeal was allowed in favor of the appellants, rectifying the unjust denial of credit and penalty.
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