2018 (8) TMI 86

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....he manufacture of Optical Fibre Cable Accessories for use by Government of India undertaking BSNL/MTNL. On the basis of investigations a show cause notice dated 31.08.2006 was issued demanding Central Excise Duty of Rs. 34,89,665/- from the appellant with further proposal to impose penalty on the other appellant. After passing through the various stages of litigation through Order-in-Original dated 17.09.2010, the demand of Rs. 13,02,885/- was confirmed and appellant were directed to pay interest on the delayed payment under Section 11AC of Central Excise Act, 1944 and another penalty of Rs. 13 lakhs was imposed on Shri V.K. Mittal the other appellant under Rule 26 of Central Excise Rules, 2004. Appellant carried the matter before Commissio....

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....ned counsel submitted that the balance demand which was confirmed, was on account of three issues such as having no matching invoices as compared to GRs, goods allegedly clandestinely removed to V.K. Industries and difference between the goods manufacture and inspected. He has argued that the sole basis for conclusion of clandestine manufacture cannot be the inspection report issued by purchaser of the goods. He has submitted that Hon'ble High Court of Allahabad in the case of Continental Cement Company vs. Union of India reported at 2014 (309) ELT 411 (All.) has held that clinching evidence is required of purchase of raw material, use of extra electricity, sale of final products, clandestine removal, transportation, payment, realization of....

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....ons that unless the person is involved in dealing with the goods liable for confiscation penalty under Rule, 26 cannot be imposed. He has relied on Final Order No. 70539/2017 dated 17.05.2017 passed by this Tribunal in the case of M/s Escorts ltd. vs. Commissioner of Central Excise, Noida. In respect of penalty under Section 11AC of the amount equivalent to the duty liability accepted by appellant to the tune of Rs. 6,19,602/-, he has also relied on the following decisions of the Tribunal in CCE, Kanpur vs. Narendra Products reported at 2010 (253) ELT 201 (Tri.) and CCE, Kanpur vs. Swastik Tubes Pvt. Ltd. reported at 2010 (249) ELT 297 (Tri.) and contended that since the duty of Rs. 6,19,602/- was paid before issue of show cause notice and,....