Penalty on co-noticee quashed after principal settled under SVLDRS; identical issues resolved, consequential relief granted

CESTAT BANGALORE - AT held that penalty imposed on the co-noticee is unsustainable where the principal appellant settled the issue under the SVLDRS; because identical issues were disposed of by the Tribunal in similar cases, the impugned penalty order against the co-noticee was set aside and consequential relief granted in accordance with law. Petition allowed.

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The appellant, Commercial Manager of M/s. UltraTech Cement Ltd., was alleged to have availed an ineligible exemption under Sl. No. 144 of Notification No. 12/2012-CE (17.03.2012). The Adjudication authority confirmed demand and imposed a penalty of Rs. 2,00,000 on the appellant; the Commissioner (Appeals) dismissed the appeal. The main assessee's appeal before the Tribunal was later settled under the SVLDR Scheme, 2019 (Final Order No. 20304/2021 dated 23.06.2021). Relying on precedents, the Tribunal held that, where the main appellant has settled the dispute under SVLDRS, a personal penalty on a co-noticee is not sustainable. The Tribunal set aside the impugned order imposing penalty on the co-noticee and directed consequential relief, observing that "once main appellant had settled the issue under SVLDRS, the penalty imposed on the appellant being the co-noticee in the show cause notice is unsustainable."

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