Cce, Jalandhar vs Shri Yadav Bhatia, Director
- CitationAppeal No. E/2825/2006-Ex (DB)
Ratio decidendi
The rule this decision rests on
Where a Commissioner (Appeals) has already decided the entire issue in an earlier order in the assessee's appeal, the departmental appeal against the adjudicating authority's non-imposition of penalty on the director is subsumed in that earlier order by the doctrine of merger, so that the later departmental appeal cannot survive independently. Where the appellate authority's order rejects the whole of the matter under challenge, and the Revenue's appeal is confined to a discrete question such as penalty, the principle in Mauria Udyog Ltd. does not apply to bar merger, because the earlier decision is taken to have covered the entire subject-matter; the Tribunal treats the doctrine of merger as operative on the facts so found. Independently, the Tribunal held that imposing penalty under section 11AC on the company and a further penalty under Rule 25 of the Central Excise Rules, 2002, on the evaded duty already constitutes sufficient punishment, so that no additional penalty on the director is warranted.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
(Arising out of OIA No.189/CE/Appl/Jal/2006 dt.31.5.2006 passed by Commissioner of Central Excise (Appeals) Jalandhar)
CCE, Jalandhar Appellants
Vs.
Shri Yadav Bhatia, Director Respondent
Appearance:
Present for the Appellant: Shri Y.P.Sharma, AR
Present for the Respondent: None
Honble Mr.P.K.Das, Member (Judicial)
Honble Mr.P.S.Pruthi, Member (Technical)
1.
Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
No
2. Whether it would be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
No
3. Whether their Lordships wish to see the fair copy of the order?
seen
4. Whether order is to be circulated to the Department Authorities?
Yes
Coram: Honble Mr. P.K.Das, Member (Judicial)
Honble Mr.P.S.Pruthi, Member(Technical)
Date of Hearing/decision: 19.01.2015
FINAL ORDER NO.502825/2015
PER: P.S.PRUTHI
This appeal is directed against the Order-in-Appeal in which the Commissioner (Appeals), rejected the appeal filed by the department for imposition of penalty on the director of the respondent.
2. The facts of the case are that M/s.Ruby Woollen Mills were involved in clandestine removal of fabrics and consequent evasion of duty. Duty demand of Rs.9,10,433/- alongwith interest and equivalent amount of penalty of Rs.9.10.433/- under section 11AC was imposed. The adjudicating authority did not impose any penalty on the director. On appeal by the Revenue, the Commissioner (Appeals) held that departmental appeal before him had already merged with the Order-in-Appeal No.317/CE/Appl/2005 dated 15.12.2005 which had been decided by him in respect of partys appeal wherein he had set aside penalty under Rule 26 of Central Excise Rules, 2002
3. Heard both sides.
4. The respondents have relied on the case of Kunhayammed Vs. State of Kerala-2001 (129) ELT 11 (SC) holding that there cannot be more than one operative order governing the same subject at the same time.
5. The Revenue, on the other hand, in their appeal has relied upon in the case of Mauria Udyog Ltd. Vs.CCE, Delhi-III-2002 (146) ELT 37 (SC)
6. We have considered the submissions. We find that the facts of the present case are different to the facts of Mauria Udyog Ltd. (supra). In the case of Mauria Udyog Ltd. the appellant challenged not only penalty but entire order of the Commissioner (Appeals) confirming the demand in that case. Honble court held that the restricting question which was the subject matter of appeal of the Revenue could not have resulted into dismissal of the appellants appeal by application of principle of merger. In the present case, we find that the Commissioner (Appeals) in his order has clearly stated that the entire issue had already been decided vide his Order-in-Appeal No.317/CE/Appl/2005 dated 15.12.2005. Therefore, we hold that the doctrine of merger will apply in this case. Even otherwise we are of the view that imposition of penalty under section 11AC as well as penalty of Rs.4,50,000/- has been imposed on M/s.Ruby Woollen Mills under Rule 25 of Central Excise Rules, 2002. Considering the total amount of penalty imposed on the evaded duty of Rs.9,10,433/-, it would be sufficient punishment for M/s.Ruby Woollen Mills and its director Shri Yadav Bhatia.
7. In view of above, we reject the appeal of the Revenue.
(Pronounced in the court)
(P.S.PRUTHI) (P.K.DAS)
MEMBER (TECHNICAL) MEMBER(JUDICIAL)
mk
1
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