TaxTMI 
TaxTMI 
TaxTMI 
2015 (11) TMI 1341
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..... On receipt of intelligence that M/s. Shyam Traders are engaged in large scale evasion of duty by unaccounted manufacture and clandestine clearances of Gutka, the factory premises as well as residential premises of Shri Sanjeev Mishra and his family members were searched on 20th October, 2003. From the residential premises of Shri Sanjeev Mishra, cash of Rs. 4,38,80,530/- was recovered for which Shri Sanjeev Mishra, at that time, could not give any explanation. Investigating Officers, therefore, placed this cash seizure under reasonable belief that the same is sale proceeds of unaccounted sales of Gutka cleared without payment of duty and hence, the same would be liable for confiscation. Subsequently, Shri Sanjeev Mishra came forward with ....
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.... by Shri V.K. Tulsian that the cash of Rs. 4,38,80,530/- seized from the premises was share application money received from investors who wanted to invest in SVOL, appeared to be false. 1.2. It is in view of the above investigation that a show cause notice dated 14/10/2010 was issued to M/s. Shyam Traders. In the show cause notice, besides the duty demand of Rs. 7,17,16,530/- from M/s. Shyam Traders in respect of the alleged clandestine clearances of Gutka during period from 1/1/2001 to 19/10/2003 along with interest thereon under section 11AB and imposition of penalty on them under section 11AC, there was also proposal for imposition of penalty under Rule 26 of the Central Excise Rules, 2002 on Shri V.K. Tulsian, who was alleged to have g....
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.... or sale, harbouring, concealment, transportation, etc of any excisable goods which he knew or had reason to believe were liable for confiscation; that a finding in this regard has already been made in para 5 of the Tribunal's order dated 12/8/2011 in case of Shyam Traders Vs. CCE-Lucknow reported in 2012 (228) ELT 468 wherein the Tribunal had set aside the penalty under Rule 26 of the Central Excise Rules, 2002 on SVOL and its Directors Shri Pratyush Mishra and Shri Sanjeev Mishra observing that the allegation against SVOL and its Directors is basically of money laundering for which there are no provision in the Central Excise Act, 1994 or the rules made thereunder for imposition of penalty; that Rule 26 of the Central Excise Rules, 1944 i....
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....r the same and since no such rectification application has been filed, the Tribunal, at this stage, cannot deal with the issue of imposition of penalty on the appellant. Shri Dixit also cited the judgment of Hon'ble Gujarat High Court in the case of Sanjay Vimal Bhai Deora Vs. CESTAT reported in 2014 (306) ELT 533 (Guj.) wherein the Hon'ble High Court has held that any person who indulged in the activities enumerated in Rule 26 in respect of any excisable goods which he knew or had reason to believe are liable for confiscation, would attract penalty under this Rule even if no goods are confiscated and that the ratio of this judgment is squarely applicable to the facts of this case. He pleaded that the appellant has abetted activity of duty ....
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....002 as the same stood during the period of dispute, provided for imposition of penalty not exceeding the duty involved on the goods or Rs. 2000/- whichever is greater, on a person who acquires possession of, or is in any way concerned in transporting, depositing, removing keeping, concealing, or in any other manner dealing with any excisable goods which he knew or had reason or liable for confiscation. It is settled law that the expression 'in any other manner' in Rule 26 has to be construed in ejusdem generis with the words appearing before this expression and therefore, penalty under this Rule is imposable on a person who has dealt with any excisable goods in the manners specified in this Rule while knowing or having reason to believe tha....