The Ahmedabad bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that a penalty cannot be imposed without recording statement of the accused.
The bench of Somesh Arora (Judicial Member) has observed that in the absence of a recorded statement of the alleged accused, penalty cannot be imposed, gets the approval of this Court. During investigation the department has also not brought on record anything indicating that the appellant as an employee in any manner benefitted from the transaction undertaken by the employer.
The appellant/assessee has been subjected to the penalty of Rs. 70,000 for alleged evasion of duty of his master, who eventually went to settlement commission and got the settlement done.
However, the appellant could not be party to the settlement process and it is therefore before this Court in the instant matter since same is maintainable despite settlement by the main accused.
However, on merits, he states that neither his statement was recorded nor it has been shown that his client-employee was benefitting in any manner by keeping the records at his premises which were alleged to have contained entries of alleged evasion by his master. He also took various other grounds on merits.
The tribunal held that the penalty has been imposed without recording of the statement of the person who is appellant, in the whole proceeding. Penalty therefore irrespective of settlement got done by the main accused, cannot sustain.
Case Details
Case Title: Vibrant Decor India Pvt Ltd Versus C.C.E. & S.T.-Vadodara-i
Case No.: Excise Appeal No. 11252 of 2013-SM
Date: 28.11.2024
Counsel For Appellant: P.G. Mehta
Counsel For Respondent: Anand Kumar
