CESTAT affirms penalties under Central Excise Rules, 2002, dismissing Revenue's appeals. Finality upheld for non-appealing parties.

The CESTAT upheld the imposition of penalties on certain appellants under rule 26 of Central Excise Rules, 2002, dismissing Revenue's appeals. The order dated 21.01.2013 imposing penalties on the present appellants who did not appeal was deemed final, as the CESTAT's decision focused only on parties involved in the appeal process. The Tribunal affirmed the finality of the penalties imposed on the present appellants and rejected Revenue's challenge, concluding that the earlier order stood.

---

---

Issues involved:
The issues involved in the judgment are related to the imposition of penalties under rule 26 of Central Excise Rules, 2002, the filing of appeals before CESTAT Ahmedabad, the remand of the matter, and the observations made by the Learned Commissioner regarding certain appellants.

Imposition of Penalties:
The present appellants, along with other noticees, were issued a Show Cause Notice (SCN) and were imposed penalties of Rs. 50 lakhs each under rule 26 of Central Excise Rules, 2002. The Order-In-Original dated 21.01.2013 imposed these penalties. Only three noticees filed an appeal before CESTAT Ahmedabad against this order. The CESTAT Ahmedabad set aside the Order-In-Original dated 21.01.2013 and remanded the matter. However, the present two appellants did not file any appeal against the original order. The Adjudicating Authority confirmed the demand and imposed penalties on the three appellants who appealed, but the present appellants were not part of this appeal process.

Observations by the Learned Commissioner:
The Learned Commissioner made specific observations regarding the present appellants in the impugned de-novo adjudication order. The Commissioner stated that the earlier order dated 21.01.2013 had attained finality in respect of certain other parties who were not the present appellants. The Commissioner's observation was challenged by the Revenue through the present appeals, arguing that the charges against the present appellants should have been confirmed in the de-novo adjudication order.

CESTAT's Decision and Finality of Orders:
The CESTAT's order dated 04.04.2013 was strictly in respect of the three appellants who had filed an appeal, and not the present appellants who did not appeal. The CESTAT found that the impugned order was passed in violation of principles of natural justice and directed the adjudicating authority to provide necessary documents to the appellants for a fair defense. The CESTAT's order set aside the impugned order and allowed the appeals by way of remand, focusing on the parties directly involved in the appeal process.

Conclusion:
The Tribunal upheld the observations made by the Learned Commissioner, stating that the order of the CESTAT was specific to the appellants who were part of the appeal process before the Tribunal. Since the present appellants did not file an appeal before CESTAT, the order dated 21.01.2013 imposing penalties on them had attained finality. Therefore, the Tribunal found no infirmity in the impugned order and dismissed the Revenue's appeals.

(Pronounced in the open court on 17.08.2023)

---