2011 (1) TMI 129

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....ically in support of the order of the Commissioner (Appeals).   2. Heard both sides.   3.1 The relevant facts, in brief, are that M/s.Kirpalu Steel Industries is a partnership firm consisting of four partners including Shri Vikash Garg and Shri Ritesh Garg. The firm is engaged in the manufacture of M.S.Bars and Patra. On the basis of investigation, a show cause notice dated 1.8.2008 was issued to M/s.Kirpalu Steel Industries and the above two partners proposing the demand of duty of Rs.17,62,106/- for the firm and proposing penalties on M/s.Kirpalu Steel Industries and the partners Shri Vikash Garg and Shri Ritesh Garg. M/s.Kirpalu Steel Industries paid part of the duty during the course of investigation and paid the balance....

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....efore, they are liable to imposition of penalties. He also relies on the decision of the Tribunal in the case of Vishan Shamlal Milwani CCE, Aurangabad reported in 2006 (202) ELT 90 wherein when the partners were involved in a serious violation, separate penalties on the partners have been sustained in addition the penalty on the partnership firm.   5. Learned Advocate strongly supports the order of the Commissioner (Appeals). Drawing my attention to the proviso to section 11A(2), he submits that the proceedings initiated by the show cause notice stands concluded not only in respect of the partnership firm, but also in respect of the partners.   6. I have carefully considered the submissions made from both sides and perused ....

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....oposed, the specific roles of the partners have also been mentioned in the show cause notice and penal action was proposed under Rule 26 of Central Excise Rules, 2002.   8. The original authority accepting the payment of duty, interest and 25% of duty demanded as penalty has closed the proceedings against the assessee, namely, the partnership firm. The proviso to Section 11A (2) specifically provides that the proceedings in respect of such person and other persons to whom notice are served under sub-section (1) shall be deemed to be conclusive as to the matters stated therein (emphasis supplied).   9. In the present case, the partnership firm was the person from whom the duty demand was proposed and other persons were asked ....