Custom, Excise & Service Tax Tribunal
M. Anvar Batcha vs Cce, Chennai Ii on 3 November, 2017
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
SOUTH ZONAL BENCH, CHENNAI
Appeal Nos. E/41031 & 41032/2013
(Arising out of Order-in-Original No. 2/2013 dated 31.1.2013 passed by the Commissioner of Central Excise, Chennai II)
M. Anvar Batcha
D. Balakrishnan Appellants
Vs.
CCE, Chennai II Respondent
Appearance Shri R. J. Pillai, Consultant for the Appellant Ms. P. Hemavathi, Commissioner (AR) for the Respondent CORAM Honble Smt. Archana Wadhwa, Member (Judicial) Date of Hearing : 25.10.2017 Date of Pronouncement :
Final Order Nos. 42589-42590 / 2017 The challenge in the present two appeals is to imposition of penalties of Rs.10,000/- on each of the appellants who are accountants working with one M/s. Pioneer Alloys Castings Ltd. The said penalties stand imposed under Rule 26 of the Central Excise Rules for aiding and abetting the main manufacturer M/s.Pioneer Alloys Castings Ltd. in their activities of clandestine nature.
2. It is seen that the demand of duty stands confirmed against M/s. Pioneer Alloys Castings Ltd. along with imposition of penalty of identical amounts upon them. In addition, separate penalty also stands imposed upon the CEO of the said company.
3. The appellants only contention is that they were salaried employees of the said manufacturing units and were working under the directions of the CEO. There is no separate role attributed to them by the lower authority so as to justify imposition of penalties. Ld. consultant for the appellant has placed reliance on many decisions of the Tribunal laying down that when there is no intention on the part of the employees, who were working under the directions of the top brass of the company, imposition of penalties upon them is not justified.
4. After hearing both sides, I find that admittedly the appellants were the salaried employees of the manufacturing unit M/s. Pioneer Alloys Castings Ltd. The Tribunal in the case of Tejas Net Works India Ltd. Vs. Commissioner of Central Excise, Pondicherry 2014 (302) ELT 80, has set aside the penalties imposed upon the two employees on the ground that the penalty already stand imposed upon the company, thus, not justifying imposition of separate penalties on the employees. To the similar effect is another decision of the Tribunal in the case of Rammaica (India) Ltd. Vs. Commissioner of Central Excise, Mumbai- 2006 (198) ELT 379 (Tri. Mum) wherein penalties imposed upon the employees are set aside on the ground that they were merely following the instructions of the employees / superiors and are not liable to penalty under Rule 25 of Central Excise Rules. The said decision stands confirmed by the Honble Supreme Court in the appeal filed by the Commissioner as reported in 2016 (342) ELT A28 (SC). Further, the Honble Supreme Court in the case of Nagpur Alloy Castings Limited Vs. Collector of Central Excise 2002 (142) ELT 515 (SC) has observed that inasmuch as the employees were nothing to gain by evading the payment of duty, Tribunals decision in imposing penalty in such circumstances was illogical. The Honble Supreme Court allowed the appeal. Reference can be made to another decision of the Tribunal in the case of Ashok Verma Vs. Commissioner of Central Excise, Delhi IV 2013 (293) ELT 410; Kalpena Industries Vs. Commissioner of Central Excise, Vapi 2015 (328) ELT 597 (Tri. Ahmd.); Parmod Kumar Vs. CCe, Jalandhar 2014 (299) ELT 483 (Tri. Del.) and Garware Synthetics Vs. Commissioner of Central Excise, Pune 2000 (116) ELT 608 (Tribunal), wherein under similar circumstances, the penalties imposed upon the employees in terms of provisions of Rule 26 stands set aside.
5. By following the above decisions, I set aside the penalties imposed on both the employees and allow their appeals with consequential relief to the appellant.
(Pronounced in open court on 03.11.2017) (ARCHANA WADHWA) Member (Judicial) Rex 3 E/41031 & 41032/2013