TaxTMI 
TaxTMI 
2010 (10) TMI 645
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....ng intimately connected with each other and 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 ....
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.... name "Panama Virginia". Samples were drawn on 6-8-85 from 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 ....
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....Golden Agency, Gaya and M/s. Smart Commercial (P) Ltd., Calcutta reportedly termed as whole 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 matt....
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...., 1944. (o) Extended period of limitation, i.e. 5 years was applicable as GTC resorted to suppression of facts and mis­statement in the matter of marking of 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 is....
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....gh bank draft in the name of different persons and such money had flown to GTC. Similar such finding also appeared in para 5.15.6 at page 77 to page 87 under different paragraphs. The recorded statement examined by the Authority 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 d....
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....to be basis for levy. Role of GTC in deciding the marked price and thereafter managing sale as well as distribution of goods also contributed for determination of liability. Accordingly, he held that GTC cannot be absolved from the 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 pac....
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....er of adjudication. She explained that the marketing distribution pattern in relation to goods of GTC was chain distribution comprising whole sellers and retailer. The names of distributors appear at page 74 of the order of adjudication. She submitted that GTC was 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 ....
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....ted the statements recorded fairly for which the allegations are baseless and there was no retraction of evidence forthwith made or attention of higher authority was invited if such allegation had substance. Therefore according to him such pleadings of appellants are devoid 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 submitte....
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....urt has directed the Tribunal to decide on three specific issues i.e. (a) flow back (b) limitation and (c) determination of liability. Such contention of Revenue was objected by the appellant's Counsel submitting that natural justice goes to the root of the matter. 11.10 Learned 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 s....
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....chits that were recovered in the course of search was subject matter of pages 68 to 72 and do not self explain the contents thereof for use against the appellants. (3) The price recorded in all the documents does not suggest that any extra sales price was realized by Sagar India with whom Mr. Vinod 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, th....
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....he has stated that he was submitting report to GTC Kolkata. This brought GTC to the chain of evidence and its questionable modus operandi came to light. 11.16 Ld. Counsel for appellants submitted that Mr. Vinod Kumar knows Hindi. His statement at pages 73-76 was recorded in English. Although that was read by Mr. Vinod 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 ....
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....ment of Hon'ble Supreme Court in the case of ITC Ltd. v. CCE, New Delhi - 2004 (171) E.L.T. 433 (S.C.). The notified goods under package were subjected to price mentioned therein. 11.19 Such averments of appellants was opposed by Shri Parasaran, learned Additional Solicitor General for Revenue submitting that entire arguments 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 d....
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.... to the Department prescribing the maximum sale price therein there cannot be any presumption that over and above such price, anything extra was realised to send to GTC through any circuit. He further brought to our notice that the sale price when quoted on the package itself that was the basis for the levy in terms of the Notification. 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....
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.... on packets of certain brands while actual sale price realised was higher than the printed price for which invoking of extended period of limitation was held to be proper. 12.4 Shri Parasaran relied on paras 51, 53, 55, 57, 58 and 59 of aforesaid order of Tribunal to submit that GTC had designed its illegal and masterminded operations in different parts of 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 opport....
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....d. There was deliberate delay caused by GTC and NETCO to find fault with adjudication at a late date with these pleas baselessly. When opportunity after opportunity was allowed to file final reply, the appellants seeking adjournment from time to time delayed adjudication and did not file final reply to show cause notice. The manner of grant of fair opportunity of hearing 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....
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....sions of higher Courts in the case of M/s. Kanungo & Co. v. Collector Customs - 1973 (2) SCC438 = 1983 (13) E.L.T. 1486 (S.C.) submitting that denial of cross-examination has not made the entire proceeding fatal and that has also not resulted with violation of natural justice. According to ld. ASG, statements recorded under Section 14 of the Central Excise Act, 1944 have lend credence to the case of Revenue being 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 arg....
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....9) brought out the manner how flow back was made from different quarters to GTC. 12.13 With the aforesaid submissions and also relying on the decision of the Tribunal relating to Bombay/Baroda jurisdiction, ld. ASG submitted that case of the present appellant is full proof case of flow back since search was done to all the premises and material recovered proved the same. The proceeding having been culminated from 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 f....
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....peal folder where these two notifications appear. According to Revenue, the appellant is not entitled to the notification benefit. When the appellant had oblique motive and various circumstantial evidence proved their modus operandi of de-frauding Revenue to cause evasion of duty that brought the appellant to purview of proviso to Section 11A of Central Excise Act, 1944. That clearly brought the appellant to the extended 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 orde....
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....ptively similar cigarettes which was determinable with reference to the Maximum Retail Price (MRP) mentioned in the cigarette packets. Such MRP without being printed on the cigarette packets as required by law was embossed. The MRP embossed on cigarette packets were hardly visible. Taking advantage of such situation the appellants were realising sale price from brand loyal consumers over and above the MRP declared on the cigarette packets since consumers 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 i....
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....gn of securing something by taking unfair advantage of another. It is a deception in order to gain by another's loss. It is a cheating intended to get an advantage. (See S.P. Changalvaraya Naidu v. Jagannath [1994 (1) SCC 1]. 16.3 Adjudication was done following due process of law on the basis of evidence establishing loss of revenue caused by the appellants undervaluing "adjusted sale price" determinable with reference to MRP. When chemical examination report 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 ....
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....eti Lal [2002 (1) SCC 100], Ram Preeti Yadav v. U.P. Board of High School and Intermediate Education [2003 (8) SCC 311], Ram Chandra Singh's case (supra) and Ashok Leyland Ltd. v. State of T.N. and Another [2004 3 SCC 1]. Suppression of a material amounts to fraud on the court - see : Gowrishankar v. Joshi Amha Shankar Family Trust, [1996 (3) SCC 310] and S.P. Chengalvaraya Naidu's case AIR-1994 SC-853. Utility and relevancy attributable to conscious possession 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 ap....
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....the appellant to discharge such burden. The nature of proof available on record established the charge for the offence brought out by Show Cause Notice. Requisite guilty knowledge was established by circumstantial evidence as well as totality of facts and circumstances. Evidence gathered by Revenue was enough to raise a presumption of relevancy and utility of incriminating materials exhibiting guilt intention of the appellants who were involved in evasion of duty possessing 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 ....
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....lisation of higher sales price and assessable value was determinable with reference to sale price realised. Natural justice : 19. Law is settled beyond doubt that the strict principles of the Evidence Act do not apply to an assessment proceeding. The materials gathered against the assessee were disclosed through show cause notice and were utilised against the assessee in assessment. The assessees were expected to meet such adverse material and thereby save themselves from 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 h....
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.... on the cigarette packets was established. In extricable links of versions in the recorded statement failed to dissociate the appellants from the grave of offence. Accordingly the materials recovered in the course of search and statements recorded by Revenue lead to irresistible conclusion that unfair practice was adopted by the appellants for their unjust enrichment at the cost of Revenue. The concepts of probability, and the degrees of it, cannot obviously be expressed in terms 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 reas....
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....ethods, and inspections and to obtain information from other persons; but it will generally be a denial of justice to fail to disclose to a party specific material relevant to the decision if he is thereby deprived of any opportunity of comment on it." [Emphasis supplied] The Hon'ble High Court observed thus :- "In other words, it seems to be a fairly settled position in law that it is not necessary that persons whose statements have been previously recorded must be examined in the presence 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 re....
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....dmitted, and admissions duly proved are admissible evidence irrespective whether the party making them appeared in the witness box or not and whether that party when appearing as witness was confronted with those statements in case it made a statement contrary to those admissions. An admission, if clearly and unequivocally made, is the best evidence against the party making it and though not conclusive, shifts the onus on to the maker on the principle that "what a party himself admits to be true may reasonably 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 ba....
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..... The normal rule which governs civil proceedings is that a fact can be said to be established if it is proved by a preponderance of probabilities. A fact is said to be proved when the court either believes it to exist or considers its existence so probable that a prudent man ought, under the circumstances of the particular case to act upon the supposition that it exists. The belief regarding the existence of a fact may thus be founded on a balance of probabilities. A prudent man faced with conflicting probabilities concerning 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 "....
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....986 (23) E.L.T. 14 (Cal.), Arya Abhushan Bhandar - 2002 (143) E.L.T. 25 (S.C.) and Swadeshi Polytex - 2000 (122) E.L.T. 641 (S.C.). We are in full agreement with the ratio laid down to follow natural justice granting cross examination. We have stated aforesaid that there was adequate evidence to appreciate case of Revenue, weighing heavier in their favour and against the appellants as discussed by the ld. Adjudicating authority in detail and stated by us in the preceding paragraphs. When the appellants failed to come out with clean 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 m....
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....cise Authorities. 26.2 Materials on record showed that there was no breach of natural justice. The SCN clearly depicted all the materials on which Excise authorities had relied to call for reply of appellants. When opportunity was given to reply on the specific charges levelled by the SCN, without filing a reply to that, the appellants have no right to insist for cross-examination since the adjudicating authority was all along deprived to come to a conclusion whether cross-examination was warranted. To say so, we rely on para-12 of 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-....
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....able relied on the decision of the Tribunal delivered on 3-3-97. According to him, GTC shall also liable when the similar appeal of the GTC was dismissed in terms of the Tribunal's order above. We appreciate that it is left open to the department to find out the mode of recovery of liability in accordance with law. But determination of liability depends on the event of levy which is manufacture following Apex Court's decision in Empire Industry (supra). The event of levy being manufacture, liability shall be determined accordingly. 30. We have 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 Corporati....