TaxTMI 
TaxTMI 
TaxTMI 
2026 (2) TMI 395
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....AN T.V.: These appeals, arising out of the same Order in Original Sl.No.18/2014 (Commr) dated 31.12.2014 (impugned order) and involving a common issue of imposition of penalty on the appellants under Rule 26(2) of the Central Excise Rules, 2002, were heard together and are disposed of by this common order. 2. Brief facts are that, in the course of investigation conducted by officers of DGCEI, Chennai, into the clandestine removal of finished goods and alleged evasion of central excise duty as well as alleged misuse of cenvat credit facility by Sri Madurai Meenakshi Amman Steel Rerolling Mill India Pvt Ltd (SMMAS) and their group companies, search operations were conducted at their factories and office premises that resulted in seizure....
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....ing Corporation and Saravana Metal Corporation, has drawn attention to the allegations against the appellants, their contentions in reply, and findings of the Ld. Adjudicating Authority and submitted that the appellants are not challenging the findings regarding their role in the alleged violations. Ld. Counsel however prays for leniency submitting that the penalties imposed are harsh and excessive. 6. Shri. R. Balagopal, Ld. Consultant appearing for SSK Iron & Steels P Ltd., submitted that the Appellants had already realized invoice value with duty and debited the duty of Rs.10,13,125/- in their cenvat account. There is no monetary gain for the appellants in abetting the main party - M/s. Sri Madurai Meenakshi Amman Steel Re-rolling Mil....
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....purchasing or in any other manner deals with, any excisable goods which he knows or has reason to believe are liable to confiscation under the Act or these rules, shall be liable to a penalty not exceeding the duty on such goods or (rupees two thousand) whichever is greater. (2) Any person, who issues - (i) an excise duty invoice without delivery of the goods specified therein or abets in making such invoice; or (ii) any other document or abets in making such document, on the basis of which the user of said invoice or document is likely to take or has taken any ineligible benefit under the Act or the rules made there under like claiming of Cenvat credit under the Cenvat Credit Rules, 2004 or refund, shall be liabl....
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....not hinge on whether the issuer has debited his cenvat account or not, the quantum of cenvat credit shown in such invoice acquires the character of the 'illegible benefit" that is available to the user and it is such benefit as per Rule 26 (2) (ii) ibid, that determines the outer limit of such penalty imposable on the issuer, irrespective of whether the user has taken, or not taken such cenvat credit. 11. Coming to the facts and circumstances of the case, it is discernible from the impugned order that JM Trading corporation, a registered dealer, is found to have issued invoices without transportation of scrap. The Adjudicating authority has further found that they have admitted to having received 55% of Cenvat and 100% vat from their cus....
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....dicating Authority as regards their role in the alleged violations is not disputed. 14. In so far as Magnum Steels Coimbatore is concerned, the impugned order holds that they transferred the scrap purchased on the same day of receipt/purchase. The Adjudicating Authority has chosen to impose the penalty on the ground that there is mismatch in the bills of entry number indicated in the cenvat invoices issued while indicating that what has been supplied are goods that have been imported under bills of entry or procured from local traders/suppliers. The contention of the appellant that the payment for the same was received through bank also is not controverted. However, it is also noted by the Adjudicating Authority that certain quantity of ....
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....violations. This Tribunal cannot lose sight of the fact that the number of instances the violation has occurred, the quantum of benefit sought to be passed on, whether the appellants are repeat violators etc are also germane to the decision on the quantum of penalty. In the given facts and circumstances, taking all the above factors into consideration, this Tribunal is of the view that the penalties imposed on them are excessive and are not in proportion to the gravity of the violations committed by them. 18. In light of the aforesaid discussions and findings, having regard to the submissions advanced at the Bar, considering the totality of the facts and circumstances of this case, and also keeping in mind the interests of justice, while....