Customs, Excise and Gold Tribunal - Delhi
M/S. Amco Tal & M/S. M.D. Merchant vs Cce, Rajkot on 17 April, 2001
ORDER
G.R. Sharma
1. This is an appeal against demand of duty amounting to Rs. 27,58,169.64, imposition of a fine of Rs. one lakh and imposition of penalty of Rs. 30,00,000/- on the firm and Rs. 5 lakhs on the proprietor.
2. The facts of the case are that the appellant in the name of M/s. Amco Talc was a proprietary concern and was engaged in the manufacture of Telcum Powder. the appellant entered into agreement with M/s. Muller & Phipps India Ltd. whereby the said company had agreed to purchase the products manufactured by the appellant's firm under the terms and conditions of the agreement. An enquiry was instituted against the appellant about clearances made from time to time. A SCN was issued to the appellant asking them to explain as to why duty should not be demanded and why penalty should not be imposed. For demand of duty for longer period proviso to section 11A(1) of Cental Excise Act was invoked. The Commissioner after taking into consideration the reply of the appellant and the submissions made confirmed the demand of duty and imposed penalty as indicated above.
3. Arguing the case for the appellant Shri K.K. Anand, Ld. Counsel submitted that the appellant had nothing to say about the demand of duty and submitted that duty amount has already been deposited.
He, however, submitted that he would like to argue only on the question of imposition of penalty. He submits that in the instant case penalty has been imposed both on the proprietor and the sole proprietary concern. He submitted that penalty cannot be imposed on both. He, therefore, submits that penalty can be imposed only one.
4. Ld. Counsel submits that in the instant case the amount of duty is only Rs. 27 lakhs whereas a penalty of Rs. 30 lakhs has been imposed on the firm and a penalty of Rs. 5 lakhs has been imposed on the sole proprietor. He submits that the penalty is too harsh. Ld. Counsel submits that the appellant deposited the amount of duty as soon as it is possible and looking to the facts that the appellant has already deposited the amount of duty and looking to the amount of duty also penalty was too harsh. he, therefore, prays that the amount of penalty maybe reduced.
5. Shri S.P. Rao, Ld. DR submits that the appellant had been involved in the forging of the Central Excise records and since forging of documents is a serious allegation, therefore, the amount of penalty is nominal in as-much as under Rule 173Q. Cental Excise Commissioner can impose penalty equal to five items the value of the goods. He, therefore, prays that there is no case for reducing the penalty imposed on the appellant.
6. We have heard the rival submissions. We have also perused the case records. We note in the instant case that the appellant had already deposited the amount of duty. We note further that penalty has been imposed both on the proprietor and the proprietary concern which is not sustainable in law. In the circumstances, penalty on the proprietor is set aside. In so far as penalty on the firm is concerned, the penalty amount is Rs. 30 lakhs though the amount of duty in the instant case was only Rs. 27 lakhs. Looking to the facts that the appellant had already deposited the amount of duty as also that the amount of duty was only Rs. 27 lakhs, we reduce penalty amount of Rs. 15 lakhs. We do not pass any order regarding the demand of duty as the point was not placed before us. We do not interfere with the redemption fine also.
7. The appeal is disposed of in the above terms.