TaxTMI 
TaxTMI 
2017 (11) TMI 413
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....en lakh) on M/s. Bharath Plywoods & Timber Products and of Rs. 1,00,000/- (Rupees One lakh) each on Shri Haridas Gordhandas and Shri Arun Kumar Dattani and of Rs. 2000/- (Rupees Two Thousand) on Shri APM Mammootty. 2. The brief facts are that: (i) Based on the intelligence, the Central Excise officers searched the premises of the appellant namely M/s. Bharath Plywood & Timber Products (P) Ltd. and other related premises on 22.08.86 and seized certain incriminating documents. (ii) The search conducted at other related premises also resulted in seizure of documents. (iii) The search at the factory of the appellant, M/s. Bharath Plywood & Timber Products (P) Ltd. also resulted in seizure of 49 sheets (107 m2) finished commercial plywood, 56 sheets (110.42m2) finished Block Boards, and 101 sheets (212.83m2) of finished veneered particle boards (Total 206 Nos.) valued at Rs. 17,337.55 as these were found in excess of the recorded stock and kept in the corner of the factory. (iv) The Central Excise officers recorded the statements of the following persons: (a) Shri P. Narayanan Kutty, Excise clerk in M/s. Bharath Plywood Timber Proucts (P) ....
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....ve Lakhs Eighty Nine Thousand Four Hundred Thirty Two & paisa sixty seven only) and imposing redemption fine and penalties as mentioned in para 1 above. (viii) The appellants went in appeal before the Tribunal, where firstly stay order SB/S/Order No. 225/1989 dated 3.7.1989 (Appeal Nos. 847-849 & 1345/89) was passed asking the appellant company to make pre-deposit of a sum of Rs. 6,50,000/- (Rupees Six Lakhs Fifty Thousand only) on or before 16th October, 1989. (ix) But the appellant company filed miscellaneous petition before the Tribunal seeking extension of time to comply with the Tribunal s order dated 3.7.89 regarding pre-deposit. (x) The Tribunal vide its SB/M/ Order No. 191/1989 dated 16.10.1989 granted further extension of time up to 30th January 1989 for complying with the Tribunal s order dated 3.7.1989. (xi) Further on the appellant company s petition, the Tribunal vide its SB/M/Order No. 11/1990 dated 30.1.1990 granted further extension of time for making pre-deposit till 30.04.1990, recording the appellant company s plea that they had already deposited Rs. 65,000/-. (x) Further on the misc. application filed by the appellant....
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....and on the appellants for recovery of dues of Central Excise confirmed by the impugned order (original), the appellant company approached again the High Court of Kerala through WP(C) No. 678 of 2014 (H) and the Hon'ble High Court delivered its judgment dated 12.06.2014, wherein the following observations/directions were made: "9. The fact remains that so far the abovementioned appeal has not been decided by any of the authorities. As matters stand now, Ext. P2 is the last communication by which the petitioner was informed that the records are not available. Under such circumstances, it is necessary in the interest of justice that the records are re-constructed and for that purpose, the petitioners as well as respondent authorities shall make necessary arrangement for production of copies of the available records, i.e. memorandum of appeal as well as connected records and the 1st respondent has to consider the matter and pass appropriate orders in accordance with law. Until such time, recovery pursuant to Ext. P7 has to be kept in abeyance." 10. In the said circumstances, this writ petition is disposed of as under: (1) Petitioners as well as respondents 3 ....
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....eligently following their appeals though they approached the Hon'ble Kerala High Court for early disposal of their appeals. The High Court vide their order dated 12.06.2014, apart from ordering for reconstruction of the file directed for disposal of the appeals within six months. We note already long period has lapsed and the present attitude of the appellant seeking adjournment on these frivilous grounds is not acceptable. The sufficiency of the appeal papers, reconstructed documents itself requires examination which can be done when the party present their case for appeal. 4. As a last chance for the appellants, to present their case, the appeals are posted on 29.08.2017. We note that if the appellants are not making appearance to present their case, the Tribunal will be constrained to dispose of the appeals based on available records." 3. With above background of facts, we have heard both, the learned Advocate, Shri Romy Chacko for the appellants and the learned DR, Dr. Ezhilmathi for the Revenue. 4. The learned Advocate inter alia submits as under: (i) The appellants no. 2 & 3 have since died, therefore the proceedings against them will abate. (....
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....nt of Central Excise. 6.1. The appellant contends that there are no evidences with the Department to support the unaccounted manufacturing and clandestine removal of the unaccounted finished goods. The appellant further contends that there is no evidence of extra raw-materials received, no evidence of actual removal/transportation of unaccounted finished goods, no receipt of their sale proceeds, no evidence for excess use of electricity for producing such unaccounted goods and so on. However in the case of unaccounted manufacture and clandestine clearances normally there cannot be 100% evidences on record as the persons committing such economic offences make conscious efforts that no footprints are left for their such nefarious activities. We take support in this regard from Hon'ble Supreme Court decision in the case of Collector of Customs, Madras and Others Vs. D. Bhoormull [1983 (13) E.L.T. 1546 (S.C.)]. The Hon'ble Supreme Court in the said case observes as under : "30. It cannot be disputed that in proceedings for imposing penalties under clause (8) of Section 167, to which Section 178A does not apply, the burden of proving that the goods are smuggled goods, is on ....
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....s not mean that the special or peculiar knowledge of the person proceeded against will relieve the prosecution or the Department altogether of the burden of producing some evidence in respect of that fact in issue. It will only alleviate that burden to discharge which very slight evidence may sight." In the present case also, the activities and the transactions perpetrated by the appellants which are part of the present proceedings are in the nature of unaccounted manufacture and clandestine clearances to evade payment of Central Excise duty and these are definitely in the nature of white collar crimes like smuggling, evasion of taxes/duties of State etc., and observations of the Hon'ble Supreme Court made in the above decision are rightly applicable to the present facts. Therefore, the appellants cannot be allowed to argue that for all the transactions, there is requirement of making 100% proof available. We are of the view that Revenue has made its case of unaccounted manufacture and clandestine removal to sufficient degree of certainty as discussed above as well as in the impugned order. 6.2. The appellant also cited the case laws to support their submissions and arguments....
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....applicability of the rule, which makes the difference. The probative effects of evidence in civil and criminal cases are not however always the same and it has been laid down that a fact may be regarded as proved for purposes of a civil suit, though the evidence may not be considered sufficient for a conviction in a criminal case. BEST says : There is a strong and marked difference as to the effect of evidence in civil and criminal proceedings. In the former a mere preponderance of probability, due regard being had to the burden of proof, is a sufficient basis of decision : but in the latter, especially when the offence charged amounts to treason or felony, a much higher degree of assurance is required. (BEST, S. 95). While civil cases may be proved by a mere preponderance of evidence, in criminal cases the prosecution must prove the charge beyond reasonable doubt. (See Sarkar on Evidence, 15th Edition, pp. 58-59) In the words of Denning LJ (Bater V.B, 1950, 2 All ER 458, 459) It is true that by our law there is a higher standard of proof in criminal cases then in civil cases, but this is subject to the qualification that there is no absolute standard in either case. In criminal ca....
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....oved." The present case concerns with evasion of payment of duty of excise and above observations of CESTAT, Bangalore are rightly applicable here. 6.4 Hon'ble High Court of Himachal Pradesh in the case of Commissioner Central Excise Vs. International Cylinders Pvt. Ltd. [2010 (255) E.L.T. 68 (H.P.) observes that no law can be interpreted in a manner so as to give premium to illegal and criminal activities; it is a basic common sense that no person will maintain authentic records of the illegal activities or manufacture being done by it. 6.5. CESTAT, Bangalore in the case of Ramachandra Rexins Pvt. Ltd. Vs. Commissioner of Central Excise, Bangalore-I [2012 (295) E.L.T. 116 (Tri.-Bang.) has held that only yardstick is preponderance of probability and not mathematical precision and on this yardstick department s case here has been sustained. It follows from the case law cited above that the department need not prove the case with mathematical accuracy. So long as the department has established the case with such a degree of preponderance the existence of a fact, it is sufficient. 6.6. Based on above discussions and the case laws cited, we are in agreement with the finding....
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....adras and followed with a letter dated 20.10.86. He also stated that the statement should not be relied upon; but he did not give the facts as given by him in the reply. In letter he simply stated that he was a dealer getting his supplies from the factory. There is no mention that he was acting as a depot in-charge also. It is also seen that there is no material fact in this statement which is not mentioned in the reply to the show-cause notice. As such the allegation by Shri A.P.M. Mammootty is baseless. 38.1. For calculating the duty evaded by the Unit, the total production as per their private Production Register was calculated, production noted in RG-1 Register was subtracted and duty worked on the part of production suppressed from entering in RG-1 register. Therefore the amount demanded in this show-cause notice is not limited by any other assessment proceedings. 39. From the fact that they did not pay the EPF contribution to the Government which was collected from the employees is sufficient to prove that the company had total disregard for fulfilling their legal obligations. They also had submitted that they were not giving even a day s credit to their cus....
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....gh he was not connected with the company. He had also shown that he was operating a depot of the factory at his business place though such depot ceased to operate very long before. The submission of the learned counsel on behalf of Shri Mammootty that the consignments from M/s. Bharath Plywoods & Timber Products (P) Ltd. were addressed to self and all documents were made out in the name of M/s. Victory Plywoods, even though the actual consignee was his client, is sufficient to prove that his client abetted with the assessee in transporting the excisable goods including the clandestinely cleared goods and in disposing the same so efficiently that no trace of evidence could be left out. And therefore he is liable for penal action under Rule 209A of the Central Excise Rules, 1944. 6.7. We are of the considered view that the appellants have not been able to counter any of the evidences against them available on record and discussed earlier above. When it is so, we sustain the confirmation of the demand of duty of Central Excise of Rs. 65,89,432.67 (Rupees Sixty Five Lakhs Eighty Nine Thousand Four Hundred and Thirty Two and Sixty Seven paisa only) as done in the impugned order along....