TaxTMI 
TaxTMI 
2015 (12) TMI 3
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....R.) ORDER Per : Ramesh Nair Applicants filed six applications for Restoration of Appeals. The respective appeals bearing Nos. E/927/09, E/923/09, E/926/09, E/835/09, E/832/05 and E/833/09 have already been restored alongwith other connecting appeals vide this Tribunals Misc. Order No. M/1112-1115/15/CB dated 2/3/2015 therefore these applications for restoration became infructuous and are therefore dismissed. 2. The twelve stay applications are directed against Order-in- Original No. 64/C.EX/COMMR/2008 dtd. 19/12/2008 passed by the Commissioner of Central Excise & Customs & Service Tax, Aurangabad. 3. The facts of the case are that a show cause notice F. No. V/18-4/TE/05/170 dated 17/2/2005 was issued to the applicant wherein it was alleged that M/s. Vatan Textiles Ltd.(herein after referred as M/s. VTL) have manufactured the goods in their EOU and cleared in DTA without payment of duty under the name of fictitious units viz. M/s. Loomcraft Fabrics Pvt. Ltd. and M/s. Fabrikart Furnishings Pvt Ltd; M/s. VTL have contravened the provisions of Notification No. 53/97-Cus as they have used the duty free capital goods for manufacture of the goods sold in DTA in the name of....
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....re manufactured on the machines of M/s. VTL. Shri. Shafeeq Ahmed , Director of M/s. VTL and M/s. Fabrikart has stated in the statement dated 2/11/2004 that there was sample order of party to M/s. VTL and required yarn was purchased by M/s. VTL only. Due to non availivility of DTA sale permission to M/s. VTL the goods in question were intended to be cleared in the name of M/s. Fabrikart. (ii) The CAD file of M/s. VTL on the computer contained designs in respect of M/s. VTL as also M/s. Loomcraft. These records show that goods were manufactured by the production department of M/s. VTL for the parties of M/s. Loomcraft like M/s. Raymonds, M/s. BDMC, M/s. M.K. Enterprises, M/s. Vivid Kollage, M/s. ITC Hotels etc. However Warping Register of M/s. VTL shows the details of beam number, date of preparation of beam, and loom number on which these beams were used. The remark column of the register shows names of some customers. These records show that goods were manufactured by M/s. VTL. Dispatch register of M/s. VTL were also found by the investigation which shows the date of production and dispatch to the customer of M/s. Loomcraft. Shri. Zaheer Ansari, Director (Technical) of M/....
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....capital goods and clearing the same clandestinely, the appellant became ineligible for the exemption on said capital goods under Notification No. 53/97-Cus and consequently they are liable for payment of custom duty on the imported goods. Therefore show cause notice proposed for demand of excise duty on the finished goods cleared in DTA and custom duty on the capital goods, confiscation of capital goods and penalties on companies as well as various individual applicants. In the denovo adjudication, Ld Commissioner has passed following order: A(1) Capital goods of M/s. VTL valued at Rs. 5,29,75,870/- are hereby confiscated under the provisions of Section 111(o) of the Customs Act, 1062. However I give an option to M/s. VTL to redeem the same on payment of fine of Rs. 1,35,00,000/-in lieu of confiscation. A(2) Demand for the amount, equal to the duty of Customs amounting to Rs. 2,73,80,647/- in respect of capital goods is hereby confirmed against M/s. VTL in terms of the conditions of Notification 53/1997-Cus and in terms of condition of the bond executed by M/s. VTL. A(3) The recovery of interest from M/s. VTL on the aforesaid amount is hereby confirmed in....
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....nd authentic. Warping register is general register wherein various person record the data relating to warping of yarn over the beam. It also happens that such data may be recorded twice and thrice by the different persons. Therefore Warping register cannot be taken as concluding evidence for confirmation of demand. He further submits that during the period involved, M/s. VTL undertaken the job work for K.S.R. exports against DTA sale permission dated 31/3/2004, however quantity of fabric manufactured for job work was not considered. M/s. Loomcraft was engaged in the manufacturing fabric through job work and the said fact was informed to the department vide letter dated 4/11/2004 and accordingly M/s. Loomcraft were filing quarterly returns therefore it cannot be said that M/s. Loomcraft was used for clandestinely removal of M/s. VTL. Ld. Counsel also submits that there are serious discrepancies in the quantification of the goods said to have been cleared clandestinely and accordingly duty calculation is also wrong. It is his submission that the value of the goods adopted on the basis of raw material cost plus job work charges is on assumption basis on the ground that the department ....
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....sick unit and proceedings under the BFIR is going on therefore on the ground of financial hardship, the applicant M/s. VTL is entitled for total waiver of pre-deposit. 5. On the other hand, Shri. V.K. Agarwal, Ld. Addl. Commissioner(A.R.) appearing on behalf of the Revenue reiterates the findings of the impugned order. He further submits that none of the submissions, made by the applicants can be accepted on the ground that this is a full proof case of clandestine removal from 100% EOU. The investigation revealed the systematic modus operandi with intension to evade excise duty. From the investigation it has come on the record that the applicant in collusion with their group companies M/s. Loomcraft and M/s. Fabricart, adopted the modus operandi by which the goods manufactured in the 100% EOU was cleared clandestinely without payment of duty in the name of M/s. Loomcraft and M/s. Fabricart. He submits that on investigation, the stand taken by the appellant regarding the job work of M/s Loomcraft, has been proved wrong as no job worker was found to have undertaken the job work for M/s. Loomcraft and M/s. Fabricart. In this situation all the goods sold by M/s. Fabricart and M/s. L....
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....es i.e. M/s Loomcraft and M/s Fabricart that the goods alleged to have been manufactured by M/S. VTL were manufactured on job work basis on their behalf, got demolished on the basis of enquiries conducted with the so called job workers, where it was found that there exist no such job worker or they do not have any loom to manufacture of fabric. The so called job workers in their statements clearly stated that they did not carry out any job work on behalf of M/s Loomcraft and M/s Fabricart. Moreover, the records of warp found in the factory of M/S. VTL clearly shows that the goods were manufactured and cleared by VTA and the same has been corroborated by the statements of directors of the Appellant Companies M/s VTA, M/s Loomcraft and M/s Fabricart. In view of the detailed investigation and the various evidences found, it is a prima facie case of evasion of excise duty committed by M/s VTA an 100% EOU. As regard demand of custom duty on imported capital goods by denying the exemption notification No.53/97-Cus, we observed that as per the export import policy, the capital goods imported by 100% EOU is exempted with the conditions that the same is used for manufacture of the final pro....