The Customs, Excise & Service Tax Appellate Tribunal, Ahmedabad held that the penalty of Rs. 1 Lakh imposed on the director of the company is not sustainable.
Facts
The appeal is filed by Shri Azaz Lokhandwala who is director of Schurter Electronis (India) Pvt. India Pvt. Ltd challenged the imposition of penalty of Rs 1 Lakh under Rule 26 of Central Excise Rules, 2002. As regard the case of demand of duty against the company M/s Schurter Electronis (India) Pvt. Ltd the same was settled under Sabka Vishwas (Legacy Dispute Resolution Scheme), 2019 and the appeal stand dismissed as deemed withdrawn by this Tribunal.
Submisisons
Saurabh Dixit, Counsel, appearing on behalf of the appellant at the outset submits that the short payment of duty is due to inadvertence on the part of the company which is procedure lapse.
Decision
The two member bench of Ramesh Nair Member (Judicial) and C L Mahar Member (Technical) found that in the show cause notice there is no charge made against the director of the company and straightway the penalty under Rule 25(1)(d) of Central Excise Rules, 2002 was proposed however in the Adjudication order the penalty was confirmed under Rule 26 of Central Excise Rules, 2002. The adjudicating Authority has given the findings that merely by motioning wrong provision the penalty cannot be set aside.
The Tribunal observed that in the case there is a procedural lapse on the part of the company the goods were cleared on payment of duty. The only lapse is that the appellant could not obtain the permission for the quantity cleared in DTA.
Case title: Azaz Lokhandwala Director v/s C.C.E. & S.T.-Vadodara
Citation: Excise Appeal No. 10275 of 2013 – DB
