COMMISSIONER OF C. EX. Vs. VIKAS GARG

JUDGEMENT

(1.) THIS order will dispose of CEA Nos. 84 and 85 of 2011 as both the appeals arise out of same facts but in the matter of two partners. The appeals have been preferred by the Revenue under Section 35G of the Central Excise Act, 1944 (for short "the Act") against order dated 5 -1 -2011 ( : 2011 (266) E.L.T. 137 (Tri. -Del.)) passed by the Customs, Excise & Service Tax Appellate Tribunal, New Delhi whereby claim of the Revenue for imposition of penalty under Rule 26 of the Central Excise Rules, 2002 (for short "the Rules") on the partners of the firm was declined.

(2.) THE Revenue served a show cause notice dated 1 -8 -2008 on the firm M/s. Kripalu Steel Industries that the said firm is indulging in clandestine manufacture and clearance of M.S. Bars/Patra etc. and using clandestinely procured M.S. Ingots from various furnace units. This led to search of the premises on 27 -2 -2008. At the time of search, shortages were found. Noticee M/s. Kripalu Steel Industries agreed with the shortages and paid the duty on the spot on 27 -2 -2008. Later M/s. Kripalu Steel Industries was called upon as to why the total Central Excise duty amounting to Rs. 1762106/ - (BED Rs. 1710782 + Ed Cess Rs. 34216/ - + Cess Rs. 17108/ -) and the deficiency in the payment of Central Excise duty amounting to 218336/ - (211976 + 4240 + 2120) on 57.155 M.T. M.S. Ingots and Rs. 36520/ - (35456 + 709 + 355) on 9.560 M.T. M.S. Bar/Patras be not recovered from them under Section 11(A)(1) of the Act. It was also stated that why the penalty should not be imposed on the firm under Section 11AC of the Act. Apart therefrom such notice to the firm, the partners were issued show cause notices as to why penalty should not be imposed under Rule 26 of the Rules.

(3.) LEARNED counsel for the appellant vehemently argued that the conclusion of proceedings under Section 11A(2) of the Act does not absolve the partners from the penalty proceedings initiated separately under Rule 26 of the Rules.