The Ahmedabad Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has recently set aside the penalty imposed for alleged clandestine removal of goods, as the penalties in two other common cases were quashed.
The appeal arises from a case of alleged clandestine removal made by M/s Pure Enterprises Pvt. Ltd. The allegation of clandestine removal was mainly based on some diaries recovered from brokers and follow up action was taken upon various manufacturers mentioning in the said diaries of the brokers.
The adjudicating authority confirmed the demand and imposed penalty on among others present appellants under section 26(1) of Central Excise Rules, 2002. Being aggrieved by the Order-In-Original the appellant filed an appeal before the Commissioner (Appeals) who rejected the appeals and upheld the penalties.
Aggrieved appellant approached the Ahmedabad Bench of the Customs, Excise and Service Tax Appellate Tribunal.
Sarju Mehta, Chartered Accountant appearing on behalf of the appellant submitted that under a common investigation various cases were made out against various manufacturers for alleged clandestine removal on the basis of diaries recovered from brokers.
He further submitted that in two identical cases in respect of the similarly placed appellant including some of the same appellants of this case the penalties were set aside. He thus contended that following the said two orders, the penalties in the present case was also not sustainable.
Rajesh K Agarwal, Learned Superintendent (AR) appearing on behalf of the Revenue reiterates the finding of the impugned order.
The Tribunal bench of Judicial Member Ramesh Nair observed that “present appellants were also involved in the case of Shri Hari Steel Industries and also in the case of M/s. Pure Alloys Ltd. in the said cases the Tribunal has taken a view that the appellants are not liable for the penalty.”
It was also observed that, “identical facts and issues were involved in the above cases of M/s. Pure Alloys Ltd, Shri Hari Steel Industries , Bansal Castings wherein all the present appellants were implicated as a common person. Therefore, following the aforesaid order the penalty in the present case is not sustainable.”
The penalty imposed on the appellants were consequently set aside and the appeal was allowed.
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