TaxTMI 
TaxTMI 
TaxTMI 
2017 (7) TMI 392
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....nducted enquiry with the appellant as well as HPCL. During the enquiry, the officers recovered various records of the appellants and HPCL and also recorded statements of various persons namely- 1. Shri Ashok Manibhai Patel, Dy. Managing Director of M/s Standard Drum & Barrel Mfg. Co. 2. Shri Chetan Hemraj Khera, General Manager of M/s Standard Drum & Barrel Mfg. Co. 3. Shri S.S.Bandakar, Manager (Bitumen) of M/s. Hindustan Petroleum Corporation Ltd. 4. Shri Raja Bahadur, SRKGKS, Sr. Accounts Officer of M/s. HPCL. From the scrutiny of the records such as Material Receipt Report of HPCL & appellants GP1. It was revealed that as per the GP1 total number of drums cleared to HPCL is 9,10,306 whereas as per the MRR of HPCL the total number of drums received is 10,37,408/- which resulted difference of 1,45,743 drums which were alleged to have removed clandestinely without payment of duty. Therefore a show cause notice bearing F.No.V/PI/Cess/12-163/TFB/96/M.II/756 dt.31.3.1997 was issued which was culminated into Order-in-Original No.F.V.Adj(Ch.73)15-67/97/5593 dt.21.11.1997. Being aggrieved by the said order-in-original the appellant filed appeal before the Tribunal. The Tribunal vid....
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....s than the quantity shown in the GP.1 on some other date it may be more than that for the reason that the HPCL is not accounting in MRR as per the GP1 quantity but as per the drums taken for Asphalt Filling for this reason there is a mismatch between the quantity of MRR and quantity of drums shown as cleared under GP1. He submits that the Chartered Accountant appointed by HPCL has certified the cost of material provided to the appellants by HPCL and quantity on which excise duty was paid by the appellants. He submits that entire case of clandestine removal is based on the admission made by Shri Ashok Patel Deputy Director of the appellant, in his statement that certain number of drums were cleared without payment of duty and on the basis of difference of quantity found shown in HPCLs, MRR and appellants GP.1. He submits that HPCL has given a report showing the number of drums received and filled by HPCL for the period 1.3.1992 to 31.3.1994. As per the said report the total number of drums as per MRR of HPCL comes to 18,96,047. During the said period as per the GP1 of the appellant and RT 12 return the quantity cleared on payment of duty comes to 19,13,033. In this regard, he submit....
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....ystem of clearance of drums under the cover of GP1 and the recording of quantity in MRR is a regular procedure. Therefore there is no intention to evade payment of duty hence the extended period of limitation is not invokable. As regard penalty he submits that the penalty was imposed under Rule 173Q(1). He submits that there is no mens rea on the part of the appellant as the entire exercise of demanding duty is revenue neutral. Therefore penalty under Rule 173Q(1) is not imposable. 3. Shri S.V. Nair, Ld. Assistant Commissioner (A.R.) appearing on behalf of Revenue reiterates the findings of the impugned order. He submits that it is admitted fact that there is a difference in the quantity cleared and shown in GP.1 by the appellant and the quantity of drums recorded in MRR of HPCL. This is a clear evidence of clandestine removal therefore the lower authority rightly confirmed the demand. 4. I have carefully considered the submissions made by both the sides and perused the records. Since this appeal is taken for reconsideration as per the High Courts direction, it necessary to reproduce the order of the High Court which is below: "12. After having heard both sides, we are of the vi....
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....n incomplete manner leads us to the only conclusion that the Tribunal has failed to perform its duty and in accordance with law. 16. We have, therefore, no alternative but to allow these appeals and instead of, as desired by the Revenue, we undertaking the exercise which the Tribunal is expected to undertake and complete, we would prefer to allow both sides a fair opportunity and before the Tribunal itself. We do not wish to conclude the matter and to the detriment or interest of either parties for they would lose one valuable right of appeal in the event of an adverse order. 17. For the above reasons, we allow these appeals by setting aside the order of the Tribunal and restore both the appeals of the assessee and the Deputy Managing Director to the file of the Tribunal for being decided afresh on merits and in accordance with law. While deciding them afresh, the Tribunal should not influence itself by any finding in the impugned order which we have quashed and set aside nor it should be influenced by our setting aside its order. For we clarify that we only emphasize the controversy between the parties and not expressed any opinion thereon. All contentions of both sides are kept....
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....lear that there was a threat of arrest as he was arrested by the officers therefore his submission that the statement was recorded under duress cannot be taken as incorrect. More over vide letter dt. 11.8.1997, Shri Ashok Patel has specifically retracted his statement therefore as per the circumstances of the entire proceedings and retraction made by him the statement regarding acceptance of clandestine removal cannot be used as evidence. As regard the difference of quantity between the GP1 and MRR, the same alone cannot be made basis for clandestine removal for the reason that the staff of the HPCL has categorically stated that the MRR is prepared on the basis of the quantity of drums filled with asphalt. Therefore it is very obvious that quantity of GP1 cannot be the same as quantity of drums filled with asphalt e.g. if as per GP.1 100 drums were supplied in a day and only 80 drums were filled with asphalt, the MRR will show 80 drums as against 100 drums shown in GP.1. Obviously, the 20 drums will be lying on the conveyor belt. On the next day again as per GP.1 if 100 drums were cleared and on that day if 120 drums are filled with asphalt the MRR will show 120 as against 100 numb....