TaxTMI 
TaxTMI 
2010 (10) TMI 645
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.... arising out of common cause are dealt by this common order for disposal. Direction of apex court : 2. While remanding the matter, Hon'ble Supreme Court noticed that Tribunal in its order dated 21-3-2001 had not dealt the question of flow back nor had also taken note of finding recorded by the Collector of Central Excise on such issue, while there was an allegation of the same in the Show Cause Notice. Similarly, the finding on limitation recorded by the Tribunal was not satisfactory to the Apex Court for which a detailed finding by Tribunal was called for. With such observations, the Apex Court required the Tribunal to decide the matter afresh in accordance with law keeping in view the observations made by the order reported as above. While directing so, the Hon'ble Court also clearly expressed its opinion that nothing stated in the order shall be taken as expression of opinion on the merits of the dispute for which all contentions were left open. Background of investigation : 3. The appellant "NETCO" in Appeal Case No. E/154/88-A was manufacturing specified brands of cigarettes on behalf of the appellant "GTC" in Appeal Case No. E/153/88-A under the control of the later and t....
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....rom the market in respect of "Panama" brand manufactured by NETCO and similar such brand manufactured by all connected concerns of GTC at its different factories located in various places. Chemical examination of these goods virtually showed in terms of report dated 17-9-1985 of Central Excise Laboratory, Kolkata that there was no difference in the quality of the brands of all such goods. Accordingly, Revenue was of the opinion that there was no difference between two brands i.e. 'Panama Viriginia G' manufactured by NETCO and 'Panama Virigina (Special), manufactured by GTC in its various factories. But there was only difference in the printing of the word. 'Special' and the word 'G'. 3.3 It was further noticed by Investigation that in Shillong cigarettes of aforesaid brand were sold at different prices and market enquiry from retailer showed that higher sale price was collected by GTC against the price embossed by cigarette packets. GTC was marketing the product manufactured by the NETCO and sale price over and above the price embossed on the packets were collected by that appellant from the wholesale buyers and such higher sales proceeds after deduction of expenses were channelis....
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.... sale buyer of the said goods were selling the said goods to different dealers at the rates other than declared rate to Central Excise Department. (e) The dealers were selling the said goods to the retailers through different salesmen appointed/employed by GTC in the north east region @ 2.60. (f) Higher sales price were collected from the retailers through the salesmen of the dealers and such money was transmitted to GTC deducting therefrom the expenditure incurred for the establishment like salary of the salesmen, transport, trunkcall, etc., keeping sale price of quantity of goods supplied calculated at the declared sale price. Dealers were submitting statement of expenditure to M/s. Smart Commercial Co., Gauhati, i.e. The extra realisations were remitted either by cash through special messenger or by Demand Drafts/Cheques, in fictitious address and name. (g) GTC was realising some amount, in the name of interest @ 27% on the amount outstanding dues from their whole sale buyers. (h) The cigarettes in question were sold in retail at a higher price as a matter of routine and the retailers were left with no margin, if they were to sell cigarettes at the marked price. From 11-....
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....f correct price on packets for retail sale which was done by NETCO in complicity with GTC. (p) The duty evaded was recoverable from NETCO or GTC under rule 9(2) of the Central Excise Rules read with Section 11A of the Central Excises and Salt Act, 1944 and the penalty leviable on each clearances under Rules 9(2), 210 and 226 of the Central Excise Rules. 4.2 The appellants without furnishing reply to the show cause notice delayed the process of adjudication on some pretext or other like non-supply of documents, cross-examination not allowed and no return of unrelied documents made. Adjudication : 5. While the adjudicating authority allowed several opportunities to the appellants to file their reply to SCN as depicted in paras 4 to 4.38 of the order-in-original, dilatory tactics was adopted by the appellants in the aforesaid manner to avoid adjudication. However, learned Adjudicating Authority granting opportunity of hearing completed the adjudication by an order dated 16-10-1987, framing following issues:- (1) Whether the cigarettes in question ("the goods" for short) were sold to consumers in accordance with the maximum price marked on packets for retail sale. If not, why an....
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....hority brought to record shows that there was realisation of excess sale price and the price marked on the packets were lower than the actual price realised from sale of cigarettes. Price was embossed on cigarette packets instead of the same being printed on the packets. Such practice was found to be dubious and that comes out from para 5.15.11 of the order-in-original at page 83. Correspondences gathered in the course of search were subject matter of examination under para 5.15.12 and that showed that there was realisation of the higher sale price which had flown back to GTC through unaccounted deals as above through its conduits. Examining the material facts with the evidence before the learned Adjudicating Authority, in para 5.15.13 at page 87, that Authority came to the conclusion that the cigarettes in question were not being sold to consumers at the price marked by embossing the same on packets for retail sale, but those were sold at much higher price, and duty, on such higher price realised was not paid. Thus there was evasion. Finding in adjudication on second issue : 7. So far as the second issue relating to determination of basis of levy whether shall be on marked price....
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....responsibility of ensuring that NETCO should discharge proper duty liability and until the duty so realisable is paid by NETCO following prescribed procedure of Central Excise, GTC should also be liable. 8.2 The retail sale price having been marked by NETCO under instructions of GTC, duty was paid by NETCO on the adjusted sale price as worked out by GTC. When excess realisation of the sale price was established proving that the price marked on the packets was not genuine, GTC was mainly responsible for the evasion of duty. NETCO having paid the duty on the price embossed on the packets, GTC was liable for the excess sale proceeds realised. There was deliberate and wilfully designed scheme to evade duty for which the Id. Adjudicating Authority in terms of para 10.2 of order at pages 135 to 140 of the order-in-original concluded that the modus operandi resulting with flowback of excess sale price realised over and above price marked on the cigarette packets, made GTC liable to pay duty on excess sale price realised. 8.3 It was held by learned Adjudicating Authority that the marked price not being genuine, there was suppression of the fact to result in loss of Revenue, evading duty ....
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....as appointing distributors and distributors were appointing whole sellers. The retailers were taking goods from the whole sellers. She drew attention to the relied upon documents (page 1 in a folder submitted in the course of hearing) where one Shri Lakshmipat Ghorawat was stated to have been appointed as whole seller by GTC was submitted to be not correct. According to her, that person, was proprietor of the business concern M/s. Business Distribution Centre and that comes under the distributor of M/s. Samrat Commercial Pvt. Ltd., who was a distributor. Her submission was that at no point of time, NETCO had appointed distributor or whole sellers or having any control over them. It was GTC that had appointed the distributors and distributors have chosen their whole sellers and retailers buy goods from whole sellers. 11.2 Mrs. Bagchi referred to page Nos. 102-104 complied in a folder submitted in the course of hearing and submitted that those were relied upon documents for issue of show cause notice. She submitted that evidence recorded by the authorities at pages 102-104 has no credence for the reason that they were not connected with GTC or NETCO. She further submitted that the s....
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....void of merit. 11.6 Mrs. Bagchi drew attention to page 146 and submitted that Revenue required the appellant to file affidavit in respect of statement of 15 persons appearing in that page. Cross-examination was all along being prayed by the appellant in respect of four persons appearing at page 141 of appeal folder. But that was not allowed. Statement was recorded by Revenue from those persons and used against the appellant. Similarly she submitted that the statement was recorded from 10 retailers who had no existence nor cross-examination allowed. She referred to pages 150 and 151/209 and 208 of the appeal folder. Drawing attention to page 153/206, she further submitted that for denial of cross-examination, the proceeding has been vitiated. Drawing attention to page 159/2000, she also harped that cross-examination is the only requirement of law to test creditability of the witness of Revenue. She further submitted that the un-relied upon documents were not at all returned by Revenue although they agreed to return the same through various correspondences. According to appellants when cross-examination was paid a deaf ear, un-relied upon documents would have served interest of just....
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....ed Counsel for appellant invited attention to page No. 83/276 to deal with the issue No. 1 framed by learned Adjudicating authority submitting that such issue comprised 3 sub-issues appearing at pages 80/276 and 279 of the appeal folder. She submitted that the question of natural justice is an essential ingredient to decide the issue of flow-back. Any conclusion drawn violating principles of natural justice relying upon the documents gathered by Revenue against the appellant without being tested by cross-examination shall result in denial of justice. Drawing attention to pages 91 to 104 of the compilation filed by the appellant she submitted that documents inadmissible in evidence fail to establish their credence without cross-examination being allowed. 11.11 Mrs. Bagchi invited attention to documents at pages 102 to 104 of the compilation filed by the Appellant and submitted that these three documents show similar version in the answers to questions No. 5, 6 and 10 of the recorded statement. But the Officers of Revenue present during hearing before us along with Shri Apalak Das, ld. Asstt. Commissioner, from Gauhati discarded plea of appellant stating that the officer who recorde....
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....nod Kumar was working as Manager. The invoice price and the sale price do not throw any light as to realisation of any extra money. These chits also do not show any payment made to GTC. (4) Panama Cigarette was not found in stock at the time of search. No Panchnama was prepared by search party to conduct search on 17-9-85. 11.13 Mrs. Bagchi categorically submitted that when cross-examination of Mr. Vinod Kumar was called for to test the authenticity of the above said documents, Revenue did not allow cross-examination. Several prayers were made by appellant before Revenue to allow cross-examination. But that was not granted. The figures appeared in chits without any reference or contexts do not provide any basis for charge. She referred to page 100/259 which is a show cause notice and invited attention to Mr. Vinod Kumar's statement appearing therein. According to her, there was no price difference at all realised. She invited attention to pages 73 to 76 of compilation and submitted that the statement recorded on 18-9-85 was not called for testing the material at pages 64-72 of compilation. Accordingly she submitted that the statement of Mr. Vinod Kumar at pages 73-76 leaving con....
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....od Kumar, the English version was not his version. She drew attention to the observation of the ld. Commissioner in the adjudication order and submitted that nothing has been spelt out in that order against the appellant NETCO. 11.17 On the issue of flow back, learned Counsel Ms. Nisha Bagchi submitted that there was no flow back of funds from dealers at grass root to GTC Industries. She invited attention to para 5.15.06 of the order of adjudication to submit that demand draft which was alleged to be instrument of flow back of funds to GTC, do not at all relate to GTC for the very reason that none of the drafts were found to be in the name of GTC. Revenue has failed to establish the identity of maker of the Bank draft and recipient of such drafts. Apart from this, Revenue has not explained whether Swastik Enterprise and Manipur distributor have made the Bank draft to transmit to GTC. Although books of account of these two parties were examined by Revenue, nothing has come out to mean that GTC was recipient of the bank draft. Similarly, she submitted that there was no evidence on record to show as to whether there was identifiable messenger to carry any money for GTC which was alle....
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....ents of the appellant as aforesaid were made in the writ petition of the appellants filed before Hon'ble High Court of Delhi and Hon'ble High Court of Gauhati, which were lost by them. They are again making an attempt for reappraisal of evidence without submitting a reply to show cause notice to Revenue. Therefore, their submissions are devoid of merit. 11.20 Learned Counsel Shri Asthana reiterated that no opportunity of cross-examination being granted, the proceeding has become fatal. In support of his submission, he relied on the judgment of Hon'ble High Court of Bombay in the case of GTC Industries Limited v. Union of India - 1991 (56) E.L.T. 29 (Bom.). He submitted that appellant's contention is based on the ratio laid down by Hon'ble High Court of Calcutta in the case of Rungta Sons Pvt. Ltd. & ors. v. CC, Visakhapatnam - 1986 (23) E.L.T. 14 (Cal.). He drew our attention to the Apex Court judgment in the case of Arya Abhusan Bhandar v. Union of India - 2002 (143) E.L.T. 25 (S.C.) and submitted that denial of cross-examination is violation of natural justice and any order passed showing such a violation is liable to be set aside. He further drews our attention to the judgment ....
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....ication. When this is the intention of levy, Revenue has no scope to further inquire as to what was the sale price realised by the appellant. Realisation of sale price not being basis or event of levy, the marking of the sale price is of significance for law. Therefore, Revenue should not construe the things for its own convenience. Finally, he submitted that entire operation of NETCO being within the knowledge of Revenue, there cannot be any allegation as to escapement of duty liability for which extended period of limitation cannot be invoked. He also argued that when one of the share holder is a State Government Undertaking, no clandestine practice was adopted by the appellant. There was no liability at all incurred by any of the appellants and neither duty nor penalty was imposable for which appeals being merited may be allowed. Submissions of Revenue : 12.1 Ld. ASG Shri Parasaran appearing on behalf of Revenue submitted that Hon'ble Supreme Court has required Tribunal to answer on following three issues :- 1. Whether there was flow back to GTC 2. Whether the proceeding is within limitation and 3. A finding to be recorded on the question of liability of the parties in r....
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.... the country through different agencies and entities to cause evasion of Revenue through various conduits and that was established by search result. One Mr. Ghorawat who was witness in GTC's case in Bombay also appears in the present appeal of NETCO. Tribunal has found that the said witness has established material facts from the statement recorded from him in favour of Revenue. 12.5 Ld. ASG submitted that from pages 118, 120, 122, 123 of the paper book it can be appreciated that there were job workers in the Bombay and Baroda case and Tribunal has also noticed such fact. Existence of job workers was brought out in the show cause notice in respect of that jurisdiction and liability of job workers was fastened in that proceeding while making GTC liable. 12.6 The allegation of violation of natural justice granting no opportunity for cross-examination does not merit consideration in view of discarding of such a plea by the Tribunal in GTC, Bombay/Baroda case where similar methodology was followed by the appellants as that has been pleaded in NETCO's present appeal. This Bench of Tribunal while dealing with NETCO case earlier although had recorded in para 4 of its order about decisio....
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....ring apparent from adjudication order, discards the allegation of violation of natural justice which is proved from different sub-paragraphs of order-in-original. When the appellant did not file replies to show-cause notice, cross-examination sought was uncalled for being premature and unwarranted in absence of explanation or defence led by reply to Show Cause Notice. Ld. Counsel who was appearing in NETCO and GTC's case made submission for cross-examination without filing reply to show cause notice to deprive Revenue to adjudicate the matter promptly. Cross-examination was uncalled for when the appellants choose to be silent to file reply to show cause notice. Attention to para 4.8 of the order-in-original was invited in this regard. 12.9 According to Shri Parasaran entire conduct of the appellant tested in terms of the observations made in para 4 of the order-in-original does not warrant to hold that there was violation of natural justice. The appellant had contacted the adjudicating authority for their documents soon after search on 17-9-85. They made request to provide copies of the documents. That was allowed by Revenue which is established by letter dated 20-3-09 available o....
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....eing recorded in the course of judicial proceeding and all the judgments deciding the principles of law relating to cross-examination come to rescue of Revenue. He brought out that there was search conducted on 17-9-85 and soon after that, a show-cause notice was issued on 13-10-85. The documents relied upon for issuance of that show cause notice formed part of the show cause notice dated 24-2-86 which was in addition to the show cause notice dated 13-10-85 due to power conferred on a different Authority for adjudication. When the Show Cause Notice was first issued on 13-10-85, non-relied upon documents were supplied to the appellants. Therefore, the appellant's grievance that they could not defend in absence of non-relied upon documents has no substance. He discredited the arguments of the appellant submitting that they are not governed by judgment of ITC (supra) for the reason that there was no allegation of flow back in that case and that has been categorically found out by the Apex Court. Therefore once flow back is established, the appellant is out of the purview of the ITC judgment. He submitted that Para 36 of the judgment in this respect being relevant may be referred to. ....
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....rom the result of the common search, these appeals fail. 12.14 Ld. ASG Shri Parasaran further argued that NETCO was manufacturing deceptively similar goods as that of GTC. He drew our attention to pages 110 to 120 of the appeal folder to deal with page Nos. 25 to 29 of Revenue's paper Book (R-2) dealing with the chemical test report relating to goods manufactured by the GTC as well as NETCO showing that same goods were manufactured by both. According to Revenue, the joint venture of the GTC with the State Government of Assam gave birth to NETCO. But such an apparent format of business was not real because of exclusive control and dominance of GTC through its active involvement beginning from manufacturing process till realisation of sale proceeds. Revenue has found out from the statement of Shri Paresh (Ref: Page. 232) that role. of GTC was to control NETCO by all means and that was an established fact. Similar such control was in respect of all other activities. Shri Paresh was Sr. Accountant of GTC. He revealed various facts about the flow back of sale proceed of cigarette manufactured by NETCO to GTC. According to him what that is apparent through joint venture was not real. He....
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....ed period following various decisions of the Apex Court. To cite a few, he referred to the following decisions :- 1. 1995 (84) SCC 50 [sic] 2. 2007 (10) SCC 337 = 2007 (216) E.L.T. 177 (S.C.). 3. 2007 (10) SCC 344 [sic] Findings of Tribunal : 13. Heard both sides from time to time, perused the records and recorded their detailed arguments aforesaid on the respective dates of hearing. Also we have perused the record as well as different documents to which our attention was drawn by both sides. Direction of Apex Court being to examine the matter afresh keeping in view the observations made in the order reported in 2008 (228) E.L.T. 505 (S.C.), we looked into various contentions of parties which were left open to them by Apex Court's order. Appellant raised issue of violation of natural justice, denial of cross-examination, manufacture of deceptively similar goods, no realisation of higher sales price, no flow back, proceeding barred by limitation and no liability of parties and no penalty. Revenue discarded pleadings of the appellants relying on Tribunal's order dated 3-3-1997 passed in respect of Bombay and Baroda factories of appellant (GTC) and held in favour of Revenue. S....
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....umers were unaware of the dubious practice adopted by appellants. In the circumstances, there existed grounds upon which the belief of contravention of the provisions Act was entertained by the Search Officials. In the course of search it was found that the appellants had in their possession, custody and control various incriminating documents demonstrating their questionable conduct. When there existed some material upon which belief warranting search could be formed, Courts are not concerned with the propriety of the belief or sufficiency of the material. The circumstances were so eloquent that they themselves presented oblique motive of the appellants. Thus search was unassailable and statements recorded in the course of search were in accordance with law. Suppression of material facts and deceptively similar goods manufactured proved undervaluation for which adjudication not barred by limitation : 16. Search of different factory premises and other premises of GTC located at different places and its job workers located at different places including premises of NETCO was made on 17-9-1985 as per Para 2(4) at Page 68 Order-in-Original. That resulted in discovery of incriminating....
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....port dated 17-9-1985 established that there was no difference in quality between the "deceptively similar" brand of cigarettes manufactured by NETCO and regular/original brands of cigarettes manufactured by GTC in its different factories and at different places through its job workers that established undervaluation of goods so manufactured by NETCO. Also that proved evasive practice and suppression of material facts in price lists submitted for approval by Excise Authorities. That brought them to the purview of proviso to section 11A of Central Excise Act, 1944 for invocation of extended period. So also the MRP on cigarettes being embossed in barely visible manner proving conduct of the appellants contumacious. When all these practices surfaced through investigation that established fraud and that has unravelled all. Revenue's stand has been fortified from the ratio laid down by Apex Court judgment in the case of UOI v. Jain Shudh Vanaspati Ltd. - 1996 (86) E.L.T. 460 (S.C.). Except the baseless plea that non-relied upon documents were not supplied and no cross-examination was allowed, the appellants failed to show that adjudication suffered from any legal infirmity. 16.4 Adjudic....
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....n proving realisation of higher sales price and flow back thereof : 17. It is quite common that materials gainful and useful to possessor thereof are consciously possessed by him. He knows utility thereof and that remains in his special knowledge being concealed in his mind till discovery by investigation. Statements recorded by Revenue u/s 14 of the Central Excise Act, 1944 in the course of judicial proceeding in respect of materials recovered were not retracted proved worth of the same for the investigation. There was no disclaimer of the materials recovered in the course of search and statements recorded on the basis of such materials from deponents proved proximity and intimate connection thereof with the trade of appellants and persons connected thereto. The statements remained in tact without any retraction. Relevancy thereof was implicit from possession and utility thereof proved from contents. That lent support to the case of Revenue bringing out nexus and live link with the appellants as well as to their trade. Excess sale price realised was proved from cogent evidence gathered and the seized materials explained remittance of such price through the conduits in the shape o....
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....ossessing and explaining contents of materials. 17.1 Entire adjudication proceeded with the conception given to Revenue by GTC that NETCO was its job worker manufacturing cigarettes out of raw materials supplied by GTC. The goods manufactured by NETCO were under control of GTC and GTC was taking back entire product for marketing. The marketing net work was under exclusive control and domain of GTC. Cigarettes being subjected to levy of duty in terms of guideline of Notification No. 211/93-C.E., dated 4-8-83 and No. 100/85-C.E., dated 25-3-85 as amended, declaration of price printed on packets was mandate of such levy. Such declared price was determinative of "Adjusted sales price" for levy. But instead of printing the price, that was embossed on cigarette packets which was not acceptable to law. Sale prices were realized through market net work over and above the embossed price in terms of cogent and credible evidence gathered by Revenue from the persons intimately connected with the trade and that was successfully proved by learned ASG before us drawing attention to evidence in the Paper Book of Revenue. Revenue successively repelled arguments of appellants tracing the nexus and ....
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....rom any adverse assessment. This in fact is a well-accepted rule of natural justice. The AO as a quasi-judicial Tribunal has not acted beyond such a principle as demonstrated by his reasoned and speaking order. The appellant on some pretext or other went on seeking time on baseless pleas to avoid consequence of adjudication. Such conduct of appellants is patent when they preferred to file reply to show cause notice after completion of adjudication. Adjudication was completed on 16-10-87 and order-in-original served on 30-10-1987. But the appellants filed reply to show cause notice on 27-10-1987. 19.1 Adjudicating Authority in terms of Paras 4.1 to 4.38 at Pages 25 to 42 of Order-in-Original dealt the manner how the appellants went on delaying adjudication on one plea or other. His finding clearly shows that all relied upon documents were supplied to the appellants. But the appellant failed to show the extent to which non-relied upon documents prejudiced their interest. They simply asked for such non-relied upon documents to cause delay to adjudication. Entire plea for such documents were vague, indefinite and on irrelevant grounds as well as baseless. In absence of sound reason, p....
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....of units to be mathematically enumerated as to how many of such units constitute proof beyond reasonable doubt. There is an unmistakable subjective element in the evaluation of the degrees of probability and the quantum of proof. In view of the above the statements used in adjudication does not appear to have made the same arbitrary or capricious nor vitiates the same. Cross-examination : 21. No doubt reliance and testimony of a witness calls for cross-examination. The evidence in adjudication proceeding need not be like the one in criminal cases. Findings should be on the basis of preponderance of probability. The Adjudicating Authority in para 4.45 of Order-in-Original at pages 51 to 56 stated reasons why cross-examination plea was found to be dilatory tactics. The witnesses were not innocent, but were found to be well conversant with appellants' trade who established their close association with the appellants and goods traded. They were also found to be uninfluenced by Revenue and statements were recorded in all fairness. Reference may be made to the decision in the case of Rup Chand Jain v. Collector of Customs (Preventive), Calcutta, reported in 1996 (88) E.L.T. 335 (Cal.) ....
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....e of the party against whom such previous statements are intended to be used. The rules of natural justice do require that their previous statements must be made available to the party against whom they were intended to be used and such party must be given a fair opportunity to explain the same or comment on them. What would amount to fair opportunity would depend upon the facts and circumstances of each case...." [Emphasis supplied] 21.2 The Apex Court in Surjeet Singh Chhabra v. UOI, reported in 1997 (89) E.L.T. 646 (S.C.) held that Customs officials are not police officers and admission made before them though retracted binds the deponent. In view of voluntary statements recorded and such statements not retracted did not warrant cross-examination when other circumstantial provided reliable basis corroborating the statements. When nothing surfaced that the witnesses had any enmity with appellants, those were not liable to be discarded nor required to be put to cross-examination. Relying upon the decision of the Apex Court in Surjeet Singh Chhabra case (supra) this Tribunal in Jagdish Shanker Trivedi v. Commissioner of Customs, Kanpur - 2006 (194) E.L.T. 290 (Tri.-Del.) held tha....
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.... be presumed to be so and until the presumption was rebutted the fact admitted must be taken to be established. Preponderance of probability : 22. Department is not required to prove its case with mathematical precision to a demonstrable degree; for, in all human affairs absolute certainty is a myth, and as Prof. Brett felicitously puts it - "all exactness is a fake". El Dorado of absolute proof being unattainable, the law, accepts for it, probability as a working substitute in this work-a-day world. The law does not require the prosecution to prove the impossible. All that it requires is the establishment of such a degree of probability that a prudent man may, on its basis, believe in the existence of the fact in issue. Thus legal proof is not necessarily perfect proof often it is nothing more than a prudent man's estimate as to the probabilities of the case. The other cardinal principle having an important bearing on the incidence of burden of proof is that sufficiency and weight of the evidence is to be considered to use the words of Lord Mansfield in Blatch v. Archar (1774) 1 Cowp. 63 at p. 65 "According to the proof which it was in the power of one side to prove and in the p....
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....cerning a fact situation will act on the supposition that the fact exists, if on weighing the various probabilities he finds that the preponderance is in favour of the existence of the particular fact. As a prudent man, so the court applies this test for finding whether a fact in issue can be said to be proved. The Adjudicating Authority has not departed from such well accepted norm which is patent from his order and completed adjudication basing on several factors. Misdeclaration : 24. No justification in respect of declaration of low MRP in "deceptively similar brands" was placed before us while on chemical test, those were found identical in quality to the "Regular brands". No stock record was produced to show that regular brand and other brand cigarettes were accounted for differently beginning from the manufacturing stage till clearance. So also no evidence was produced before us to know periodical inventory of two different brand of cigarettes whether was taken to prove from records. Similarly no stock record relating to use of different raw materials for different brands were produced. Simply a bald plea was made submitting that the regular brands and other brands are diff....
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....lean hands filing a reply to SCN, the stage for cross-examination had not reached for consideration of the learned Adjudicating Authority and to appreciate justification thereof. Once the manner how a deposition is faulty is pointed out either by denial or by other evidence to discard the deposition, an authority seizing over the matter does not get opportunity to consider prayer for cross-examination. When we noticed that there were overwhelming evidence against the appellants and there were governing facts supporting the same by attendant circumstances and corroborated by the evidence in the paper book of Revenue as well as finding of the Tribunal earlier made on 3-3-1997 which was relied upon by ld. ASG we were convinced that ld. Adjudicating authority had not based his decision only on the depositions alone but on several factors and considerations. Therefore grievance of the appellant that denial of cross-examination has made the adjudication proceeding fatal is unsustainable. 26. We have considered the citation of Revenue in the case Surjeet Singh Chhabra - 1997 (1) SCC 508 = 1997 (89) E.L.T. 646 (S.C.), in support of argument of learned ASG that the confessional statements ....
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....f judgment of Apex Court in Kanungo & Co. We are satisfied that the declaration filed before the authorities were full proof of suppression of fact, when all connected evidence proved realisation of higher MRP. Accordingly, the Excise authorities having discharged their burden of proof, the appellants had no right to call for cross-examination on flimsy plea. 27. Shri Parasaran took us to the judgment of Collector of Customs v. D. Bhoormull - 1974 (2 SCC) 544 = 1983 (13) E.L.T. 1546 (S.C.) to submit that there was concealment of facts by the appellant who followed dubious practice, proved by various circumstantial evidence and direct evidence of mis-declaration coupled with chemical reports brings the appellant to the fold of penal consequence of law. We do appreciate that the manner how evasion occurs remains within the special knowledge of the evader and that is concealed in his mind till extracted by investigation through deposition. Following para-41 of the judgment, we appreciate that the circumstantial evidence in the present appeal suggested that the inference that the goods were marketed under the ill designed scheme of realisation of higher sale price through exclusive co....
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....e found that the manufacturing activity was carried by NETCO. The goods manufactured were marketed by GTC. The event of levy being manufacture, loss of Revenue was attributable to the activity of manufacture and NETCO was liable to duty imposed by adjudication order. When ownership of goods is not material for the purpose of levy, following the Apex Court's decision Empire Industries Ltd. - 1985 (20) E.L.T. 179 (S.C.) we hold that the duty liability shall be of the job worker i.e. NETCO which had manufactured the cigarettes. Limitation : 31. As regards limitation, since NETCO is a joint venture of Assam Industrial Development Corporation (51%) and the appellant i.e. GTC (49%) it is difficult to accept the appellant's plea that NETCO being only a job worker was not aware of the wrong doing of GTC. More so, even in spite of being asked repeatedly, neither GTC nor NETCO have produced the copy of their joint venture agreement before us. We therefore hold that longer limitation period under provisions of Section 11A(1) would be available to the Department for denial of short-paid duty from NETCO. Penalty : 32. Having noticed that both the appellants had pre-meditated design through ....