2001 (8) TMI 234 - AT - Central Excise

Tribunal reduces penalty, finds Section 11AC inapplicable. Failure to follow procedures leads to reduced penalty.

The tribunal allowed the appeals by reducing the penalty under Rule 173Q to Rs. 10,000, finding the penalty under Section 11AC inapplicable due to the ... Penalty - Retrospective effect Issues:1. Imposition of penalty under Section 11AC and Rule 173Q without specifying separate amounts.2. Appellants contesting penalties imposed for alleged offenses.3. Condonation of delay in filing supplementary appeal.4. Applicability of penalty under Section 11AC to the case.5. Break-up of penalty amount.6. Reduction of penalty amount under Rule 173Q.Analysis:1. The case involved the imposition of penalties under Section 11AC and Rule 173Q without specifying separate amounts. The party contested the penalties imposed by the adjudicating authority and confirmed by the lower appellate authority. The penalties were upheld in a common order by the Commissioner (Appeals), leading to the present appeals against this decision.2. Initially, only one appeal was filed by the party, thinking it would suffice against the common order of the Commissioner (Appeals). Later, a supplementary appeal was filed after the limitation period, along with an application for condonation of delay, which was allowed by the tribunal after hearing both sides.3. The party argued that the penalty of Rs. 3 lakhs was imposed under Section 11AC for an offense that occurred before the provision came into force, making it inapplicable retrospectively. The tribunal agreed with this argument, stating that the penalty under two different provisions cannot be consolidated without specifying the amounts under each.4. The tribunal found that the penalty imposed under Rule 173Q was too harsh at Rs. 30,000. The appellants were aware of the correct procedure but did not follow it, leading to a wilful omission. The penalty under Rule 173Q was reduced to Rs. 10,000 considering the circumstances of the case.5. The tribunal noted that the penalty under Section 11AC was not applicable to the case due to the offense occurring before its enforcement. The lack of clarity regarding the breakdown of the penalty amount between Section 11AC and Rule 173Q rendered the consolidated penalty unsustainable.6. In conclusion, the tribunal allowed the appeals to the extent of reducing the penalty under Rule 173Q to Rs. 10,000, considering the totality of the facts and circumstances of the case.