TaxTMI 
TaxTMI 
TaxTMI 
2002 (8) TMI 743
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.... numbers of Rubber Rings valued at Rs. 12,00,000/- should not be confiscated under Rules 173Q and 209 ibid; (d) Penalty should not be imposed under Rules 173Q, 209 and 226 ibid. for contravention of the rules mentioned in para 20 of the Notice; and (e) They were required to produce the provisionally released goods before the adjudicating authority failing which they were asked to show cause as to why :- (i) the Bond executed should not be enforced; (ii) the Bank Guarantee should not be appropriated to the Government of India. The Notice was also issued to M/s. Deccan Enterprises (hereinafter referred to as DE), Plot No. B/58 and 60, APIE, Balanagar, Hyderabad asking them to show cause why :- (a) the differential Central Excise Duty of Rs. 10,34,619/- alleged to have been short-paid should not be paid by them under Rule 9(2) ibid read with proviso to sub-section (1) of Section 11A of the Central Excises and Salt Act, 1944; and (b) &nbs....
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....y mistake marked DEPL and rectification involves substantial expenses, additional work 'Deccan' was made on the die and hence, the rings contained the marking of both DEPL and Deccan. Regarding the marking of 'IHP' and 'ISI' on the rings, they explained that it was marked after ISI mark was awarded and after receipt of positive enquiries from 'IHP'. Regarding other markings they explained that it was the practice of all the manufacturers to engrave with the markings of all the potential customers and hence, it could not be concluded that the rings were not manufactured by Deccan Products. They gave the example of Charminar brand which awarded only to a specific product to a manufacturer. Regarding yellow paint markings they explained that they revised the date as per the requirement of the Customers. (f) Reliance on the word 'Deccan' found on the gunny bags as circumstantial evidence is not called for as due to shortage of HDPE bags a few second-hand gunny bags were brought from the market. It was the practice of their company to purchase duly branded bags and the supplier might have wrongly branded as 'Deccan Enterprises' and ....
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....44 read with proviso to sub-section (1) of Section 11A of the Central Excises and Salt Act, 1944; (ii) Whether the goods referred to at (a) above were accounted in the RG 1 of Deccan Products with an intent to claim as their own production in order to export the same under the DEEC Scheme and get duty free imports; (iii) Whether 68,345 numbers of Rubber Rings valued Rs. 12,00,000/- out of the quantity referred to at (a) above which were placed under seizure, are liable to confiscation under Rules 173Q and 209 of the Central Excise Rules, 1944; (iv) Whether 12,200 Kgs. of Rubber Compound sheets valued Rs. 5,11,394/- placed under seizure should not be confiscated under Rules 173Q and 226 of the Central Excise Rules, 1944; (v) Whether 1,900 Kgs of raw materials valued Rs. 1,21,260/-placed under seizure should not be confiscated under Rule 226 of the Central Excise Rules, 1944; and (vi) Whether penalties can be imposed individually on Deccan Products, Deccan Enterprises, S/Shri Ramakrishna, Venkateswarulu, Misra and Jalan under the relevant Rules for the contraventions....
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....attrition between Shri R.N. Jalan and Shri O.P. Jalan, leading up to the issues contravening in the Company petitions. He concluded that this was a case wherein department had been used as a means to persecute one of the parties involved in a family feud. After concluding the depositions in various affidavits filed before him by the two appellants, he concluded that the payment of CED in this case did not arise for the reason that the goods in dispute had been actually exported and therefore he did not find that there was a case for recovery of CED on 68,345 numbers of Rubber rings and other disputed goods found and they were not liable for confiscation. (c) As regards the issue of 12,200 Kgs of Rubber compound sheets under seizure and their liability for not having entered it in the records, he rejected the plea of not maintaining a RG-1 register, etc, since the DIPL had obtained a Registration Certificate No. 35/92 from the Department and had been maintaining RG-1. They found that declarant rings were not required to maintain RG-1, they were required to maintain a simple daily account register as per Hyderabad Collectorate Trade Notices. He also rejected the alternate argum....
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....oth of DE under Rule 209A. (f) Since the non-accountal of the rubber sheets and raw materials have rendered them liable for confiscation, however, as he found that there was no evidence to show remotely that DIPL intended to evade payment of duty by means of such non-accountal, he did not hold penalty under Rule 209A to be levied on Shri Ramakrishna and Venkateswarulu. (g) Thereafter under Rule 173Q and Rule 226, he ordered confiscation of 12,200 Kgs of rubber compound sheets, but the same have been provisionally released. Therefore, he ordered that the amount of Rs. 50,000/- which he would have realised as redemption fine should be realised by enforcing the terms of the said Bond and Bank Guarantee and under Rule 226, he ordered confiscation of 100 Kgs of Stearic acid and since the goods were not available for confiscation, he ordered realisation of Rs. 500/- from the bond and under Rule 173Q(1)(b), he imposed a penally of Rs. 50,000/- on DIPL and under Rule 226 a penalty of Rs. 2,000/- on DIPL and dropped the proceedings against them. 5. The present appeals are filed by M/s. DIPPL and the Revenue against this order :- (a) DIPPL have taken the grounds (Appe....
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....s proved on verification that the markings on dies/moulds and rubber rings are not one and the same and added to it one die with the marking of "DE" was found. From the above fact, it can be reasonably said that the impugned goods were not manufactured by M/s. DIPPL and due to identical products and inscriptions on the gunny bags and due to inter-relation of the units i.e., M/s. DIPPL and DE, they appear to have been manufactured by M/s. D.E. The ld. Commissioner ought to have appreciated the evidence on record. (iii) The production of M/s. DE was stated to be 45% lower than the production of M/s. DIPPL during Feb/March '95 by the assessee. It is not the case of department that the production of M/s. DE for Feb/March '95 was only transferred to M/s. DIPPL, if clearances of M/s. DE and production entries of RG 1 of M/s. DIPPL are scrutinized for the relevant period, it almost tallies. Hence, the ld. Commissioner ought to have not admitted this claim of the assessee. (iv) The ld. Commissioner's finding that no cognizance could be taken with the affidavit of R.N. Jalan and under Writ Petition No. 27 of 1987 is n....
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....fides. This act of assessee appeared to be 'misdeclaration' and 'misrepresentation' ab initio inviting special circumstances envisaged under proviso to Sec. 11A of Act. The ld. Commissioner had not appreciated the factual position at all. (iii) There is no need to stress that the Range Officer ought to have examined the palpably low prices declared by assessee at the time of RT 12 assessments. This statutory duty of Range Officer appears to be secondary in view of absence of approved price lists and variations in prices are limited to few transactions and there appeared to be inadequate consignee particulars on the invoice. The ld. Commissioner appears to have not examined the primary statutory obligation of assessee to declare correctly and properly. By misdeclaring the description of product, the assessee had not discharged his onus, and proving the onus by department as termed by ld. Commissioner appears to be misconceived. (iv) Regarding proving the precedents and antecedents of Mr. Abrar Ahmed by the investigating officer, it is to be noted that at the preliminary stage of investigation only the fact of ....
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....se Rules. In respect of 12,200 Kgs of Rubber compound sheets valued at Rs. 5,11,394/- being a declarant unit, no offence can be committed, under Rule 226 of the Central Excise Rules, 1944, even if the same were not entered into RG 1 register. That the material had not reached the stage of entry into the RG 1 register and it is only after completion of Quality Control Checks approval and packing that the same would he entered has not been controverted. In any event, there could not have been any question of any intention to remove the goods in contravention of the Central Excise Rules inasmuch as the subject goods, viz., Rubber Compound Sheets are assessable to NIL rate of duty under Tariff Item No. 4005.00. The subject goods were manufactured by the Company solely for the purpose of export and were never intended for clearance for home consumption and in fact, they have been exported. In view of these facts, the liability for confiscation under Rule 173Q read with 226 of the Rules, regarding failure to account for 12,200 Kgs. of Rubber Compound Sheets in RG-1 register with intend to remove the same unaccounted is devoid of any merits, the order of confiscation and penalty consequen....
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....al should set aside the order passed by the Commissioner and should confirm the demand of the Central Excise duty in full as mentioned in the Show Cause Notice and impose an appropriate amount of penalty taking into consideration, the gravity of the offence and duty evaded by the assessee or pass such orders as may be deemed fit." It may be pointed that the earlier appeal filed on 20-8-97 was in respect of M/s. DIPPL, but in the subsequent appeal, they have included M/s. DE and demanded differential duty of Rs. 10,34,619/-. The Department, in their Appeal dated 20-8-97, did not quantify any demand, but merely and vaguely requested that the Commissioner's Order be set aside and wanted that the Central Excise duty in full, as mentioned in the Show Cause Notice, should be confirmed and appropriate penalty be imposed. The only demand of duty in the show cause notice is Rs. 10,34,619/- against M/s. DE because the other charges pertain to confiscation and imposition of penalty. (ii) In the second appeal filed against the same order by the Department on 17-8-2001, the prayer is also vague and no quantification was shown and is in-fact a repetition of what has been stated in the fir....