2023 (10) TMI 522 - AT - Central Excise

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

C.C.E. & S.T. -Surat-I Versus Fireoz Ahmed Waghbakriwala and Percy Navroze Munshi

The CESTAT upheld the imposition of penalties on certain appellants under rule 26 of Central Excise Rules, 2002, dismissing Revenue's appeals. The order ... Levy of penalty u/r 26 of Central Excise Rules, 2002 - Revenue filed the present appeals on the ground that the Commissioner ought to have confirmed the charges against the present appellants made in the show cause notice in the impugned de-novo adjudication order - HELD THAT:- It is clear that the observation is in respect of the appellants which were before the CESTAT. Therefore, even though the operating portion of the order sets aside the impugned order but it is only in respect of appellants which were before the CESTAT. It is obvious that the parties, the appellants in the present case which were not before the CESTAT, the order of the CESTAT cannot be said to have been given in respect of the present appellant which were not the parties as appellants before the CESTAT. In view of facts and specific observation made by the Learned Commissioner in the impugned order about the present appellants is absolutely legal and correct - there are no infirmity in the impugned order - appeal of Revenue dismissed. 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)