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The Commissioner of Central Excise, Chennai v/s M/s. Southern Polymers Industrial Corporation, Chennai & Others


Company & Directors' Information:- D R POLYMERS PRIVATE LIMITED [Active] CIN = U74899DL1991PTC043773

Company & Directors' Information:- S N POLYMERS PVT LTD [Active] CIN = U19202WB1986PTC040961

Company & Directors' Information:- M .H. POLYMERS PRIVATE LIMITED [Active] CIN = U74899DL1988PTC034437

Company & Directors' Information:- A. R. POLYMERS PRIVATE LIMITED [Active] CIN = U17120UP1995PTC018494

Company & Directors' Information:- CHENNAI POLYMERS PRIVATE LIMITED [Active] CIN = U25209TN1998PTC040845

Company & Directors' Information:- A N POLYMERS PRIVATE LIMITED [Active] CIN = U25209DL1987PTC027311

Company & Directors' Information:- G D POLYMERS PRIVATE LIMITED [Active] CIN = U19202DL2001PTC109278

Company & Directors' Information:- K. D. POLYMERS PRIVATE LIMITED [Active] CIN = U27201UP2000PTC025105

Company & Directors' Information:- L P POLYMERS LIMITED [Active] CIN = L24134TG1994PLC017945

Company & Directors' Information:- M M POLYMERS PRIVATE LIMITED [Active] CIN = U25200CT2009PTC021203

Company & Directors' Information:- B. K. POLYMERS PRIVATE LIMITED [Active] CIN = U25200GJ2010PTC059282

Company & Directors' Information:- J M S POLYMERS PRIVATE LIMITED [Active] CIN = U74899DL2000PTC107276

Company & Directors' Information:- A K D POLYMERS PRIVATE LIMITED [Active] CIN = U24134DL1996PTC077526

Company & Directors' Information:- C. D. S. POLYMERS PRIVATE LIMITED [Active] CIN = U25209DL2007PTC158213

Company & Directors' Information:- R S A POLYMERS PRIVATE LIMITED [Active] CIN = U24134KL1997PTC011648

Company & Directors' Information:- I P POLYMERS PRIVATE LIMITED [Active] CIN = U74899DL1990PTC041101

Company & Directors' Information:- J P POLYMERS PRIVATE LIMITED [Active] CIN = U24134MH2004PTC148732

Company & Directors' Information:- R. S. POLYMERS PRIVATE LIMITED [Active] CIN = U74899DL1990PTC041788

Company & Directors' Information:- P R POLYMERS PRIVATE LIMITED [Strike Off] CIN = U25200DL2008PTC180282

Company & Directors' Information:- R. K. R POLYMERS PRIVATE LIMITED [Active] CIN = U25200WB2008PTC127028

Company & Directors' Information:- S AND S POLYMERS (INDIA) LIMITED [Strike Off] CIN = U28910KA1983PLC005655

Company & Directors' Information:- SOUTHERN INDUSTRIAL CORPN LIMITED [Active] CIN = L99999TN2000PLC002432

Company & Directors' Information:- A B C POLYMERS PRIVATE LIMITED [Active] CIN = U99999MH1965PTC013275

Company & Directors' Information:- K M POLYMERS PRIVATE LIMITED [Active] CIN = U25201RJ1998PTC014564

Company & Directors' Information:- S. K. H. POLYMERS PRIVATE LIMITED [Active] CIN = U24304GJ2018PTC103367

Company & Directors' Information:- P V R POLYMERS PRIVATE LIMITED [Strike Off] CIN = U24130TG2011PTC078316

Company & Directors' Information:- C R POLYMERS PRIVATE LIMITED [Active] CIN = U25200WB2009PTC134393

Company & Directors' Information:- N K P POLYMERS PRIVATE LTD. [Active] CIN = U74899DL1985PTC021735

Company & Directors' Information:- J M K POLYMERS PRIVATE LIMITED [Strike Off] CIN = U25209DL1998PTC095814

Company & Directors' Information:- R AND S POLYMERS PRIVATE LIMITED [Strike Off] CIN = U25209DL1996PTC083952

Company & Directors' Information:- SOUTHERN INDUSTRIAL POLYMERS PRIVATE LIMITED [Active] CIN = U25209TN1975PTC006954

Company & Directors' Information:- P U POLYMERS PRIVATE LIMITED [Active] CIN = U25110MH2000PTC129640

Company & Directors' Information:- A. N. S. POLYMERS PRIVATE LIMITED [Active] CIN = U24134TG1997PTC028570

Company & Directors' Information:- J K POLYMERS PRIVATE LIMITED [Active] CIN = U19200DL2014PTC270912

Company & Directors' Information:- Z A POLYMERS PRIVATE LIMITED [Active] CIN = U25209WB1997PTC084581

Company & Directors' Information:- M G POLYMERS PRIVATE LIMITED [Active] CIN = U74899DL1986PTC025967

Company & Directors' Information:- B R POLYMERS PRIVATE LIMITED [Active] CIN = U74899DL1988PTC033553

Company & Directors' Information:- H G POLYMERS PRIVATE LIMITED [Active] CIN = U25209PB2020PTC052027

Company & Directors' Information:- P K POLYMERS PVT LTD [Active] CIN = U24241WB1996PTC080830

Company & Directors' Information:- K C L POLYMERS PRIVATE LIMITED [Active] CIN = U74900WB2007PTC117162

Company & Directors' Information:- K K POLYMERS PRIVATE LIMITED [Strike Off] CIN = U74899DL1985PTC022483

Company & Directors' Information:- B M K POLYMERS PVT LTD [Under Process of Striking Off] CIN = U24295WB1978PTC031781

Company & Directors' Information:- S S N POLYMERS PVT LTD [Strike Off] CIN = U74999WB1991PTC053221

Company & Directors' Information:- V A S POLYMERS PRIVATE LIMITED [Active] CIN = U24134DL1999PTC097830

Company & Directors' Information:- H H POLYMERS PRIVATE LIMITED [Active] CIN = U45400WB2009PTC136959

Company & Directors' Information:- H C POLYMERS PRIVATE LIMITED [Strike Off] CIN = U24134WB2003PTC095702

Company & Directors' Information:- S R POLYMERS PRIVATE LIMITED [Active] CIN = U25202DL2004PTC131186

Company & Directors' Information:- S R POLYMERS PRIVATE LIMITED [Active] CIN = U74110DL2004PTC131186

Company & Directors' Information:- D H POLYMERS PRIVATE LIMITED [Active] CIN = U24294UP2000PTC025026

Company & Directors' Information:- P S D POLYMERS PRIVATE LIMITED [Active] CIN = U25209DL2010PTC204298

Company & Directors' Information:- SOUTHERN POLYMERS PRIVATE LIMITED [Active] CIN = U24294TN1983PTC010164

Company & Directors' Information:- B P POLYMERS PVT LTD [Strike Off] CIN = U24134OR1987PTC001844

Company & Directors' Information:- M S POLYMERS PRIVATE LIMITED [Strike Off] CIN = U25209RJ2013PTC042702

Company & Directors' Information:- C Y POLYMERS PRIVATE LIMITED [Strike Off] CIN = U51433DL2005PTC143373

Company & Directors' Information:- G B POLYMERS PRIVATE LIMITED [Strike Off] CIN = U25201OR1996PTC004422

Company & Directors' Information:- M S K POLYMERS PRIVATE LIMITED [Strike Off] CIN = U74899DL1988PTC033237

Company & Directors' Information:- M K POLYMERS PVT LTD [Strike Off] CIN = U51109WB1988PTC044524

Company & Directors' Information:- H. D. POLYMERS PRIVATE LIMITED [Strike Off] CIN = U74899DL1993PTC055096

Company & Directors' Information:- C AND F POLYMERS PRIVATE LIMITED [Active] CIN = U24229MH1997PTC112184

Company & Directors' Information:- T V U POLYMERS PRIVATE LIMITED [Active] CIN = U02520TZ2003PTC010892

Company & Directors' Information:- K POLYMERS INDIA PRIVATE LIMITED [Active] CIN = U51900TN2012PTC086648

Company & Directors' Information:- A. B. S. POLYMERS PRIVATE LIMITED [Active] CIN = U25203DL2009PTC196469

Company & Directors' Information:- N. C. POLYMERS PRIVATE LIMITED [Active] CIN = U25209DL2007PTC157489

Company & Directors' Information:- U & I POLYMERS PRIVATE LIMITED [Active] CIN = U25209DL2013PTC247136

Company & Directors' Information:- R. M. POLYMERS PRIVATE LIMITED [Strike Off] CIN = U25201UP1995PTC018455

Company & Directors' Information:- L K POLYMERS PRIVATE LTD [Strike Off] CIN = U25199DL1988PTC031798

Company & Directors' Information:- POLYMERS (INDIA) PVT LTD [Strike Off] CIN = U25201WB1961PTC025147

Company & Directors' Information:- S S A POLYMERS PRIVATE LIMITED. [Strike Off] CIN = U24134DL1998PTC092378

Company & Directors' Information:- POLYMERS(INDIA) PRIVATE LIMITED [Strike Off] CIN = U25209UP1973PTC003669

Company & Directors' Information:- A S POLYMERS PRIVATE LIMITED [Active] CIN = U25203MH2010PTC207149

Company & Directors' Information:- R K D POLYMERS PRIVATE LIMITED [Strike Off] CIN = U74999MH2014PTC253438

Company & Directors' Information:- E. POLYMERS PRIVATE LIMITED [Active] CIN = U25200TG2010PTC068537

Company & Directors' Information:- U E C POLYMERS PRIVATE LIMITED [Strike Off] CIN = U36100CT2012PTC000181

Company & Directors' Information:- S R K POLYMERS PRIVATE LIMITED [Strike Off] CIN = U24134DL2004PTC131753

Company & Directors' Information:- A TO Z POLYMERS PRIVATE LIMITED. [Active] CIN = U45400DL2006PTC148485

Company & Directors' Information:- M D POLYMERS PRIVATE LIMITED [Active] CIN = U74999MH1999PTC121696

Company & Directors' Information:- SOUTHERN POLYMERS LIMITED [Strike Off] CIN = U18101DL1983PLC015723

Company & Directors' Information:- CENTRAL INDUSTRIAL CORPORATION LIMITED [Dissolved] CIN = U99999MH1946PLC010721

    Civil Miscellaneous Appeal No. 1464 of 2006

    Decided On, 22 September 2016

    At, High Court of Judicature at Madras

    By, THE HONOURABLE MR. JUSTICE NOOTY RAMAMOHANA RAO & THE HONOURABLE DR. JUSTICE P. DEVADASS

    For the Appellant: A.P. Srinivas, Standing Counsel. For the Respondents: Jayachandren, Advocate.



Judgment Text

(Prayer: Civil Miscellaneous Appeal filed under Section 35G of Central Excise Act, 1944, against the Final Order No.1263 of 2005 and 1264 of 2005 dated 12.09.2005 passed by the Customs, Excise and Service Tax Appellate Tribunal, South Zone Bench, Chennai.)

Nooty Ramamohana Rao, J.

1. This Civil Miscellaneous Appeal is preferred under Section 35G of the Central Excise Act, 1944, against the orders of the Customs, Excise and Service Tax Appellate Tribunal, South Zone Bench, Chennai, rendered in Final Order No.1263 of 2005 and 1264 of 2005 dated 12.09.2005.

2. This Civil Miscellaneous Appeal was admitted by a Division Bench of this Court on 28.04.2006 to consider the following substantial questions of law:-

"(i) Whether the Tribunal has acted upon law by passing order of remand to the adjudicating authority when the point of dispute raised before them has already been elaborately reasoned out?

(ii) Whether the order of the Tribunal is merely accepting the pleas of the 1st respondent without recording any reason and just citing the decision of the Tribunal, when the adjudicating authority has given effect to it with adequate reasons, is acceptable under law?

(iii) Whether the penalty amount reduced by the Tribunal without recording any reason is correct in law?

(iv) Whether the personal penalty imposed on the 2nd respondent who has abetted the offence which was set aside by the 3rd respondent without reason is agreeable, in view of the existing penal provisions under the law?"

3. Heard Mr.A.P.Srinivas, learned Standing Counsel for the Department as well as Mr.Jayachandren, learned counsel for the Respondent/Manufacturer.

4. The controversy in this appeal lies in a very narrow campus. The first Respondent being the manufacturer of Excisable goods, has been proceeded against and the adjudicating authority has raised a demand of Rs.22,19,949/- from the Respondents, in terms of Rule 9(1) read with Section 11A of the Central Excise Act, 1944 (henceforth called the Act). The adjudicating authority has also imposed an equal amount as penalty under Section 11AC of the Act read with Rule 173Q of the Central Excise Rules, 1944 (henceforth called the Rules). Interest under Section 11AB of the Act was also demanded. The adjudicating authority has imposed a penalty of Rs.1,00,000/- on the Respondents under Rule 173Q of the Rules. One Shri N.Ramachandran has also been imposed a penalty of Rs.2,00,000/- under Rule 209A of the Rules. That Order-in-Original dated 16.03.2000 passed by the Commissioner of Central Excise, Chennai II Commissionerate, was challenged before the Tribunal referred to supra.

5. It is not in dispute that the relevant provisions under Section 11AC was not available on the statute book when the alleged failure to pay the Duty at the time of the clearance of the goods manufactured. Therefore, the Tribunal has rightly set aside that part of the Order-in-Original passed by the Adjudicating Authority.

6. Since the Respondents have not disputed the liability to pay Duty, there was no necessity for the Tribunal to examine the correctness of the adjudication in that regard. But, however, dealing with the penalty of Rs.2,00,000/- imposed under Rule 209A of the Rules, since there was no evidence brought forth to link Shri N.Ramachandran, for the alleged violations, the penalty is set aside by the Tribunal.

7. It will be relevant to notice that Rule 209A of the Rules, has specifically required that any person, who deals with any Excisable goods which he knows or has reason to believe are liable to confiscation under the Act or Rules made thereunder, shall be liable to a penalty not exceeding three times the value of such goods or Rs.5,000/- whichever is greater, if he is in any way concerned in transporting, removing or depositing, keeping, concealing, selling or purchasing or in any other manner deals with such goods. Therefore, it is essential that there must be evidence brought on record linking the role of the individual to any of these offending acts in which event alone the penalty contemplated by Rule 209A of the Rules, can be imposed. Since there was no material to link Shri N.Ramachandran, with any such acts enumerated under Rule 209A of the Rules, the penalty imposed against him under Rule 209A of the Rules, is liable to be set at naught and that was the reason why the Tribunal has rightly set aside that portion of the Order in Original passed by the adjudicating Authority.

8. Now, what remains is with regard to the levy of penalty of Rs.1,00,000/- imposed under Rule 173Q of the Rules.

9. Rule 173Q of the Rules deals with confiscation and imposition of penalties. Therein, it was spelt out that for any act of violation indulged in, where the goods are liable to confiscation by the persons involved in manufacture of such goods or registered person of a warehouse or a registered dealer, kept in a registered warehouse or registered dealer, shall be liable to a penalty not exceeding three times of the value of the Excisable goods in respect of the contravention referred to in the said Rule or Rs.5,000/- whichever is greater. The Rule itself is framed in a language which brings out an element of exercise of discretion on the part of the Adjudicating Authority.

10. In the instant case, the discretion has not been exercised on sound lines and hence the Tribunal has reduced the penalty from Rs.1,00,000/- to that of Rs.50,000/-, though the Tribunal ought to have given the necessary reasons for it to substitute the quantum of penalty. But however, we cannot ignore the fact that the Order-in- Original does not speak of the liability of the goods for confiscation itself, at the first

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place. It is therefore, obvious that instead of remitting the matter to the Adjudicating Authority for consider afresh, even with regard to the penalty that is liable to be imposed under Rule 173Q of the Rules and furthermore with a view to shorten the litigation between the parties, the Tribunal has reduced the penalty from Rs.1,00,000/- to Rs.50,000/- and the Respondent/Manufacturer has not called in question that part of the order of the Tribunal and he has accepted it. 11. Therefore, we see no reason to interfere with the order passed by the Tribunal and hence, confirming the said order, we dismiss this appeal. No costs.
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