AI Drafter 
TaxTMI 
TaxTMI 
2015 (12) TMI 223
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....3,66,483/- in adjudication appears in para 4 of the adjudication order at page 5 thereof. That was followed by equal amount of penalty and interest on the duty element. The main points of argument of Shri Asthana were as under: (1) That what M/s. Gopal Steel did is irrelevant for this appellant since this appellant was prevented to get relied upon documents touching the allegation for a long time. That barred the appellant to make reply to show cause notice. Relevant documents were supplied towards fag end of adjudication. Therefore proper defence and evidence could not be led by appellant and adjudication order was passed on 31.03.2013 with haste and hurry with utter disregard to the course of natural justice. Inviting attention to volume 3 of paper-book, it was submitted that the appellant was dealt to the detriment of justice without supply of the relied upon documents till 2010 even though investigation was made on 07.09.2007. (2) When the allegations were made on the basis of the materials recovered from a third party, those were not admissible in evidence unless put to test by cross-examination by the appellant. Neither the appellant nor it....
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....- 1. Adjudication was based on the statement of M/s. Gopal Steel only and no enquiry was conducted form transporters. 2. There were 28 consignees as was found by the department depicted in table 3 of the impugned order, but no one was examined nor they were exposed to cross examination. 3. Department did not consider point wise reply of the appellant on each point of defence raised. 2.2 Inviting attention to page 20 of adjudicating order dealing with discussion and finding, it was submitted that ld. adjudicating authority totally ignored the plea of the above 4 appellants as to calling for cross examination of necessary witness. He has recorded that the noticee No.1 which was M/s. Rameshvaram Steel only prayed for cross examination. Such factual observation is wrong. E/Stay/59634/2013 in E/58982/2013 3.1 Shri Kishore. K. Acharaya, ld. Advocate appearing in this case submits that his client took over the concern called Nav Durga Fuel Pvt. Ltd. in February, 2007. After that date, the new management has not at all dealt with M/s. Gopal Steel and not answerable to any discrepancy alleged in the show cause notice. So far as the deal of the earli....
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....e submissions. His specific submission was that the records were maintained only on telephonic calls of manufacturers and consignees without proving any involvement of the appellant in stricking the deal between them whose names appear in page No.3 of the adjudication order. This appellant made only a small commission earning bringing the buyer and seller together to carry out its business. Therefore imposition of penalty of Rs. 1 Crore on the appellant is uncalled for and unwarranted when the appellant is facing financial difficulties as in revealed by balance sheet as on 31.03.2013. 7.2 Shri Kurmi further submits that in view of the pendency of Writ Application in the case of Prompt Castings Pvt. Ltd. vs. Joint Commissioner of Central Excise, Kolkata-IV reported in 2012 (284) ELT 641 (Calcutta) there should not be levy of penalty since such levey is ultra virus the statute itself. So also he relies on the decision of Tribunal in the case of Steel Tubes of India Ltd. reported in 2007 (21) ELT 506 (Trib.) to submit that Rule 26 containing para mateia provision of the erstwhile Rule 209 A does not call for penalty on the commission agent appell....
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.... being unaccounted, that resulted in evasion of duty by the appellants. 8.4 Inviting attention to para 4.1 of the show cause notice ld. DR emphasized that statement of Shri Aggarwal categorically exhibits that he recorded the clandestinely removed goods as well as undervalued goods in his record with his exclusive knowledge and he did not disown such records as well as data in the computer relevant to the unaccounted deals. He brought out his special knowledge in respect of dealings with the manufacturers and the respective consignees. He threadbare explained how he dealt the clandestinely removed goods and under valued goods. His description was so vivid that no doubt was left to Revenue to understand that the payment against sale of sponge iron were received from customers through Cheque in the name of manufacturer in respect of accounted transactions and by cash for the unaccounted deals. The extent of involvement of all the parties was explained by Sri Aggarwal on different dates in his statements consistently as aforesaid. He did not retract such statements. That established his exclusive and special knowledge about modus operandi of the appell....
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....dgment of Hon'ble High Court and para 6 & 15 of the order of the Tribunal. 8.8 With the aforesaid summary of arguments, it was submission of Revenue that the stay applications are liable to be rejected and pre-deposit of entire demand raised against appellants, may be called for. 9. Heard both sides and perused the records. 10.1 Adjudication against all the appellants arose out of common cause revealed by the documentary evidence as well as electronic data discovered from the possession and premises of the commission agent M/s.Gopal Steel. That precisely exhibited the deals of the appellant manufacturers with the respective consignees whose name appeared in the record maintained by the commission agent. That also brought out selling and buying of unaccounted sponge iron clandestinely cleared by manufacturer appellants, causing evasion of Central Excise duty. This being the common cause and allegation against all the manufacturer appellants, all their stay applications were heard analogous and disposed by this common order avoiding piecemeal disposal thereof. 10.2 The commission agent M/s. Gopal Steel well explained the implication of ....
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....against them. They also did not rule out their dealing through the said commission agent. 10.7 Although pleadings of the ld. Counsels appeared at the first instance to be very sound on the face of it but in substance lacked force to claim dispensation from predeposit for hearing their appeals. When the appellants did not come out with clean hands dissociating themselves from the offending transactions detaching their role in evasion, they cannot be said to be innocent. Their conscious knowledge and well designed evasion strategy came to broad day light. One became witness against the other. Modus operandi followed by appellants was questionable and their oblique motive became patent. When they made entire unaccounted deals through the commission agent hiding the manufactured quantity and value thereof from the purview of the levy Revenues interest shall be prejudiced, if no pre-deposit is called from the appellants. 11. We had an occasion to hear similar such case in the case of Shree Nakoda Ispat Ltd. in stay order No.50634-50637/2014 dated 22.01.2014 as has been mentioned by ld. DR hereinbefore. Citati....