TaxTMI 
TaxTMI 
2017 (6) TMI 38
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....s of some personels on 22.11.2007. Intelligence also indicated that the rolling of their products, manufactured by RJIL was undertaken at their other factory in the name and style of M/s. Juhi Alloys Ltd. (for short JAL). The modus-operandi adopted by them was that ingots/billets manufactured by RJIL was first transferred to the premises of JAL were the same were converted into flats and bars and rods. Thereafter, the unaccounted SS Flats and bars and rods were cleared from factory of JAL under the cover of parallel invoices to their agents at Delhi and Jodhpur. During the course of search at the factory premises of RJIL, in addition to large number of documents, 298.806 MT of Stainless Steel Billets were found unaccounted, and in excess, as per RG-I register and were seized vide panchnama dated 22.11.2007. Search was also conducted at factory premises of one Laxmi Kant Goyal situated at A-103/7, Wazirpur Industrial Area, Delhi. During search in addition to documents, large number of SS Flats and Flat Cuttings of different sections and size were detained as per panchnama. As per details given in panchnama, a total of 74.328 MT of Flat Cuttings of different sizes and sections ....
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....tements tendered by them. On being further confronted from the records resumed from the house of Shri Laxmi Kant Goyal and from the factory of Shri Kapil Garg, Shri Anil Goyal stated that all the said records contained details of receipt and disposal of the SS Flats, supplied by RJIL through him, after cutting at the factory premises of Shri Laxmi Kant Goyal and Shri Kapil Garg. Shri Anil Goyal further stated that he used to receive SS Flats from RJIL for some time with bill/invoice and some time without any bill or invoice. Shri Anil Goyal, Proprietor of M/s. Agarwal Steels vide his letter requested for release of goods detained at the factory premises of Laxmi Kant Goyal and Shri Kapil Garg on the ground that he had already submitted the purchase documents of the detained goods.Revenue called Shri Anil Goyal for correlation of the detained goods with the purchase documents submitted by him. The correlation was undertaken with his association. The scrutiny of the said documents revealed that the said documents were not co-relatable to the goods detained at the premises of the two cutters, as the detained goods pertained to the goods that had been received in the very recent past, ....
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....gs) valued at Rs. 72,67,500/- involving duty of Rs. 11,97,684/- seized at the premised of Shri Kapil Garg clandestinely and deliberately with an intention to evade Central Excise Duty on the said SS Flats by not accounting for the same in their production and clearance records. Further, the quantity of 298.806 MTS of SS Billets valued at Rs. 77,68,956/- found unaccounted and in excess to the recorded balance and seized at the factory of RJIL on the day of search, were also meant to be cleared clandestinely after undertaking rolling of the same. It further appeared that all the goods were liable to confiscation under Rule 25 of the Central Excise Rules, 2002 readwith Section 11AC of the Central Excise Act, 1944. It also appeared that Shri Anil Goyal has also facilitated the clandestine removal of SS Flats consigned by RJIL to him and further unloaded directly at the premises of various cutters, knowing well that the goods loaded from the factory of RJIL were being cleared without any duty paying invoice and by his acts of omission and commission aforementioned has also rendered himself liable to panel action in terms of Rule 26 of the Central Excise Rule, 2002. The show cause notice....
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....ith any office records. This view is clear as even after more than five months the respondent could not inform the Department that the goods were defective when the goods were provisionally released. The assessees have taken this stand after provisional release of the goods. The defence of the respondent-assessees is not bona-fide and is concocted after thought. No such records of defective goods was mentioned in the RG-I register regarding 114.145 MTS and 161.500 MT of SS Flats. During inspection certain documents were seized alongwith seized goods. 'The seized goods were released as well as the documents. The Adjudicating Authority has given conclusion with respect to sale/purchase of the excisable goods, (goods in question). However, there is variation of around 4% (in excess), in the sale/purchase of excisable goods. It is pertinent to mention that respondent-assessee had option to use their previous duty paid invoices to cover up their clandestine removal at the time of adjudication, which it appears the appellant have made the best use of. However, fabrication cannot replace the truth. There is a difference of around 4% between the sale/purchase of the excisiable goods. T....
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....;ble Apex Court in the case of Collector of Central Excise vs. Decent Dying Company (1990) 45 E.L.T. 201 SC wherein it has been held in clear terms that the burden of proof, that the goods lying in the market are not duty paid is squarely on the Department, as all the goods lying in the market are deemed to be duty paid. Further, while issuing the second show cause notice the quantum of SS Flats purchased by M/s. Agarwal Steels directly from JAL, were not taken into account. Further, Shri Anil Goel proprietor of Agarwal Steels had handed over purchase file of respondent RJIL for the period 01.07.2007 to 31.03.2008 and also 57 purchase invoices relating to purchase from JAL which have been taken note of the by the Adjudicating Authority. But for the reasons best known to the investigating officers, no cognizance of the duty paid invoices of JAL who are manufacturers of SS Flats and also regular suppliers of SS Flats to Agarwal Steels was taken. During the course of search on 22.11.2007, the following quantity of SS. Flats and billets were seized at various premises detailed below : - S. No. Name and address of the remises Quantity of Goods Value Duty 1. M/s. Kapil Ga....
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....at the premises of M/s. Kapil Garg by the Officers of DGCEI. Thus there was a shortage of 6.150 MT, the difference was due to the facts that the stocks were only eye estimated and not actually weighed. The difference comes to about 4% which is negligible. Purchase Sales Balance M/s. Rimjhim Ispat Ltd. 185.350 MT 64.10 MT 121.210 MT These Flats were stored at the premises of M/s. Laxmi Kant Goyal, A-103/4, Wazirpur Industrial Area, Delhi. Against this the Officers had verified the stock as 114.145 M. T. Thus, there was a shortage of 7.065 MT. The difference of about 4% was because of the fact that the stocks were not actually weighed had been calculated on the basis of average, calling for no adverse inference. 10. It is further urged that on the basis of the above submissions, the Adjudicating Authority had dropped the proceedings in respect of SS Flats which were seized from the premises of two cutters namely Shri Kapil Garg and Shir Laxmi Kant Goel. With regard to the quantity of 298.806 MT of Billets, which were seized from the premises of respondent RJIL, it was contended before the Adjudicating Authority that these goods were rejected goods and hence ....
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....tted 30 purchase invoices of respondent RJIL and 57 invoices of M/s. JAL. In this view, the learned Commissioner (Appeals) have categorically held that the allegations of the Revenue, that respondent could not produce any duty paying document is not sustainable. Once duty paid nature of the goods in question is established, the goods could not have been confiscated. The Revenue have failed to take into account purchase of SS Flats by respondent Agarwal Steels from JAL during the months of July to November, 2007. Revenue have not given any reason to reject the statement of accounts as produced by respondent M/s. Agarwal Steels, in their grounds of appeal. I further find that appellant Revenue have not produced any positive evidence that the goods lying in the premises of cutters were more than balance stock on the date of search of respondent M/s. Agarwal Steels. SO far the doubt raised by the Revenue in the grounds regarding the unaccounted stock of 289.806 MT in the premises of respondent RJIL on the date of search, I find that learned Commissioner (Appeals) have held that there was combined stock to the tune of 3000 MT. In this view of matter also variation of about 10%, which do....