WESTERN ELECTRICAL CO. Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) THESE 3 applications for stay are filed alongwith the respective appeals filed by the appellants against the decision of the Commissioner of Central Excise (Appeals), Vadodara dated 27.9.2000. The appeals have been filed by the appellants against the confirmation of the show cause notice dated 16.2.99 made by the Addl. Commissioner of Central Excise, Vadodara made in Order -in -Original No. 04/BRC/MP/ADC/D.I/2000 dated 07.03.2000. By the said order, the Adjudicating Authority had confirmed the duty which has already been paid and also imposed a penalty of Rs. 12,34,498 under Section 11AC of the Act on the appellants M/s. Western Electrical Company in Appeal No. E/3252/2000 -Mum and Rs. 1,00,000 under Rule 173Q of the Central Excise Rules and imposed penalty of Rs. 50,000 each on the other two appellants in Appeal Nos. E/3253/ 2000&E/3254/2000.

(2.) SHRI R.C. Saxena, Advocate for the appellants states that the duty has already been paid before the issuance of show cause notice. The present applications have been filed only against the levy of penalties imposed on the applicants. He states when questioned by the Tribunal vehemently that it is difficult for him to state at this stage whether the judgment of the Supreme Court in the case of Gujanan Fabrics Distributors v. CCE, Pune will be applicable in this case. However, he states that the penalty being imposed on the alleged infraction of illegal possession should be stayed as there is no infraction in this case. He further stated that the clubbing charge which the Department has claimed in the show cause notice cannot be proved in this case. As against this, the Ld. SDR Smt. Reena Arya submits that whatever may be the case of the appellants, the clubbing is a question of facts which has been confirmed by the lower authorities. Therefore, she feels that prima facie the case is strong in favour of the department.

(3.) WE have considered the rival submissions. We are unable to agree with the submissions made by the Ld. SDR. We are prima facie of the view that a strong case has been made out by the applicants before us inasmuch as that the penalty has been imposed on the alleged infraction of law. We are, therefore, of the view that since the duty has been paid before the issuance of show cause notice as reflected in the Adjudication Order, we waive the payment of penalties demanded under the Adjudication Order as confirmed by the Appellate Order. Stay applications stand allowed by waiving the penalty imposed and staying its recovery thereof during the pendency of the appeals.