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of <h1>Penalty under Section 78A(a) set aside where main taxpayer's liability settled under SVLDRS-2019; appeal allowed</h1> <h3>Brijeshkumar Pravin Bhai Patel Versus Commissioner of Central Excise & ST, Vadodara-I</h3> CESTAT held that where the main noticee's tax liability was settled under SVLDRS-2019, the penalty imposed on the partner/co-noticee under Section 78A(a) ... Levy of penalty on partner u/s 78A(a) of Finance Act, 1994 - the case of the main noticee M/s. Brij Construction Company has been settled under SVLDRS-2019 - the documents pertaining to settlement of the case of M/s. Brij Construction Company under Sabka Vishwas (Legacy Dispute Resolution) Scheme Rules, 2019 submitted - HELD THAT:- There are various decisions wherein this Tribunal has taken a consistent view that when the case of demand of duty/ service tax against the main notice stand settled under SVLDRS, 2019, the penalty on the co-notice will not survive. This Tribunal, in M/s. Phenix Construction Technologies [2021 (6) TMI 1192 - CESTAT AHMEDABAD] held that when the case of main appellant is settled under SVLDRS 2019 (order dated 10.06.2021), the penalty imposed on co-appellant is not sustainable. Therefore, the issue is no longer res-integra and is now well settled that when the main case of duty evasion is settled. Therefore, considering the judgment of this Tribunal, the penalty of Rs. One lac imposed on Shri Brijeshkumar Pravinbhai Patel under Section 78A(a) of the Finance Act, 1994 is not sustainable and is liable to be set-aside. The penalty imposed on the appellant is set-aside - Appeal allowed. Appeal against Commissioner (Appeals) order upholding penalty under Section 78A(a) of the Finance Act, 1994. Main noticee M/s. Brij Construction Company's tax demand was settled under Sabka Vishwas (Legacy Dispute Resolution) Scheme Rules, 2019 (SVLDRS-2019). Revenue conceded the main case was settled but maintained penalty liability of the co-noticee. Tribunal relied on consistent precedent, including M/s. Phenix Construction Technologies (order dated 10.06.2021), holding that where the demand against the main noticee is settled under SVLDRS-2019, the penalty on co-noticees 'is not sustainable.' Applying that settled view, the penalty of Rs. 1,00,000 imposed on the appellant under Section 78A(a) was set aside and the appeal allowed. Order pronounced 09.05.2025.
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