TaxTMI 
TaxTMI 
2019 (1) TMI 1165
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....ed appeal against imposition of penalty on them u/r 26 of Central Excise Rules 2002. 2. The facts, in brief, of the matter is that the appellant company is manufacturer of excisable goods namely, MS ingots, MS TMT bar, Runners, Risers and Mis-Rolls falling under heading 72 of First Schedule to the Central Excise Tariff Act, 1985. They are registered with the Central Excise Department for manufacture of the said goods and are holding Central Excise Registration No. AABCA8278MXM003. On the basis of some information that the appellant company was engaged in clandestine removal of their final product without payment of Central Excise Duty, and without entering such products in their statutory records, the officers of Anti-Evasion wing of Jaipur-I Commissionerate of Central Excise visited the factory premises of the appellant company and conducted simultaneous search of factory premises of the appellant company, residential premises of Shri Rakesh Bhatnagar- General manager, office-cum-residence of Shri K.S. Ahaluwalia Chairman, Guest House of the appellant company and residence of Shri Chirag Sharma- Executive Assistant to the Chairman on 21.09.2011. In course of search of the factory....
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.... 14 of Central Excise Act 1944. During investigation the appellant company deposited amount of Rs. 1,40,93,564/- on various date(s) as per direction of the investigating officers. After scrutiny of records and comparison of the data in computer print out as well as in the slips resumed, three demand cum show cause notices were issued to the appellant company as detailed below:- S. No. SCN No. & Dt. Period involved Demand of duty (Rs.) 1. SCN No. V(H) Adj.-I/CE-72/59/2012/297 dt.03.05.2012 (i) 01.04.07 to 31.12.11 (except March 11 to June 11 & Aug 11) (ii) for March 11 to June 11 & Aug 11 Total 7,50,79,267/- 1,40,93,563/- 8,91,72,830/- 2. SCN No. V (H) Adj-I/CE-72/146/2012/3523 dt.06.02.2013 01.01.12 to 30.06.12 2,27,64,776/- 3. SCN No. V (H) Adj.-I/CE-72/39/2013/1354 dt.25.07.2013 01.07.12 to 31.12.12 11,00,285/- Grand Total 11,30,37,891/- 3. The appellant company, in addition to the duty demand, was also asked to show cause why interest should not be demanded on the amount of duty and why penalty should not be imposed under section 11AC of Central Excise Act 1944/Rule 25 of Central Excise Rules 2002. The other appellants were asked to show c....
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....this Tribunal in appeal against the said Order-in-Original dt.31.03.2014 passed by Learned Commissioner of Central Excise, Jaipur-I. 6. The Learned Advocate appearing on behalf of the appellants stated that order appealed against is vitiated for denial of Natural justice. He stated that the appellants had asked for adjournment on valid grounds, which was not even considered by the learned Commissioner. Copy of request for adjournment is placed in the appeal folder. He also submitted that the request for cross examination has been erroneously denied. He submitted that method of physical verification adopted by the officers has not been stated in the panchnama. This could have been made known only by cross examination of the officers and the panch witnesses. However the Learned Advocate categorically stated that the appellants do not want remand of the matter. He prayed for decision in the matter by this Tribunal on the basis of evidence available on record. 7. The Learned counsel on behalf of the appellant further submitted that the entire demand is based on allegation of clandestine removal on the part of the appellant company. However, there is not even an iota of evidence to sh....
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....oose slips is unsustainable. 10. The learned advocate also submitted that the demand of duty on the quantity of final product calculated on the basis of electricity consumption is unsustainable in view of law laid down in the case of R.A Casting. He also submitted that the said decision has been erroneously distinguished by the learned Commissioner. 11. As regards levy of interest, the learned counsel submitted that when the demand of duty itself is unsustainable in law, there is no question of levy of interest in the present case. 12. As regards imposition of penalty under section 11AC of Central Excise Act 1944, the learned advocate submitted that the said penal provision is invokable only in cases of non payment of duty by reasons of fraud etc. In the present case, since there is no tangible evidence of any clandestine activity by the appellant company, the ingredients specified in section 11AC are not satisfied in the present case. Likewise, the penal provisions contained in rule 25 of the Central Excise Rules, 2002, are not attracted in the present case for want of tangible evidence of clandestine removal. 13. As regards imposition of penalty on other appellants, the learn....
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....[1998 (98) ELT 787 (Tri.)] 22. P.S.P. Appliances (P) Ltd. & Ors. Vs CCE [2005 (70) RLT 431 (Tri.)] 23. CCE Vs Universal Polythene Industries [2001 (130) ELT 228 (Tri.)] 24. Utkal Galvanizers Ltd. Vs CCE [2003 (158) ELT 42 (Tri.)] 25. CCE Vs Supreme Fire Works Factory, Sivakasi [2004 (163) ELT 510 (Tri.)] 26. Andaman Timber Industries Vs CCE [2015 (324) ELT 641 (S.C.)] 27. CCE Vs Parmarth Iron Pvt Ltd. [2010 (260) ELT 514 (All.)] 28. Jindal Drugs Pvt Ltd. Vs UOI [2016 (340) ELT 67 (P&H)] 29. Century Metal Recycling Pvt Ltd. Vs CCE [2016 (333) ELT 483 (Tri.)] 30. CCE Vs Gopi Synthetics Pvt Ltd. [2014 (302) ELT 435 (Tri.)] 31. CCE Vs Heliwal Polypackers Pvt Ltd. [2016 (340) ELT 204 (Tri.)] 32. Balajee Structurals (India) Pvt Ltd. Vs CCE [2016 (341) ELT 457 (Tri.)] 33. CCE Vs Star Steels [2015 (315) ELT 495 (All.)] 34. Mahendra Steel Industries Vs CCE [2016 (339) ELT 623 (Tri.)] 35. Kuber Tobacco Products Ltd. Vs CCE [2013 (290) ELT 545 (Tri.)] 15. The Learned AR appearing on behalf of department relied on the order appealed against. He submitted that the order is based on documents recovered from the factory premises and the guest house belon....
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....paid Rs. 30,25,351/- vide Cheque dated 05.10.2011. Sh. Bhatnagar also paid Rs,10,49,669/- in lieu duty evaded on clearances in March, 2011. 15.5. The whole case is based on the unaccounted production and clearances as also on consumption of electricity. The corroborative evidences are in the form of documents - computer print outs, loose papers (Kacchi Parchi), slip pads recovered from the factory and its guest house and admissions by the stake holders. The officers of the company could not explain the reason for shortage and accepted the same and later on paid tax as calculated by Revenue. Sh. Rakesh Bhatnagar, GM, Sh. Dinesh Goswami, Excise Executive and Sh. Anil Sharma, Marketing Head & Authorised Signatory, in their respective statements have admitted that the recovered documents were related to their company - M/s Kamal Sponge Steel & Power Ltd. and that on the basis of those documents they were reporting to Sh. Karan Pal Singh and other Directors of the company. They have also accepted sales in cash without Invoice and without payment of duty. That is why they on different dates paid huge amount of over Rs. 1.40 crores as excise duty recoverable from them, for their clandest....
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....w laid down in Bajrang Petro Chemicals (P) Ltd., case is no more a good law in view of contrary judgement of the same High Court in the case of Continental Cement Company Vs UOI reported in 2014 (309) ELT 411 (All.). 17. Heard both sides and perused the records. In this case the demand of duty is on the basis of allegation of clandestine removal of excisable goods without payment of duty. Such allegation has been levelled against the appellant company primarily on the basis of shortage in the stock of finished goods detected by the officers, comparison of figures in computer print outs and loose slips recovered from the guest house with the figures in the statutory records maintained by the appellant company and alleged actual production calculated on the basis of electricity consumption. Before discussing the evidence on record relating to the allegations made against the appellant company and other appellants, we propose to first deal with the issue of violation of principle of Natural justice in the present case. 18. The Learned Commissioner in para 49 of the order appealed against has observed that the appellants had been given sufficient opportunity, and did not care to appe....
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.... in stock of final products is un-sustainable and demand in this regard is fit to be set aside. (ii) Demand based on figures/data in computer printout/loose slips The computer printout and loose slips relied upon by the department for alleging clandestine removal had been recovered from the guest house and from factory premises also. As regards computer printouts, there is nothing on record to suggest the manner in which such printouts were taken. There is also nothing on record to suggest fulfillment of the conditions stipulated in section 36 B of the Central Excise Act 1944 in order to treat computer printout as admissible piece of evidence. The fulfillment of the conditions stipulated in Section 36 B (2) of Central Excise Act 1944 is must for taking computer printout as evidence in the Adjudication proceeding. In this connection we are guided by this Tribunal's order in the case of Premium Instruments & Controls Ltd. Vs CCE reported in 2005 (183) ELT 65 (Tri.). Para 9 of the said judgment is re-produced below:- 9. On the demand of duty on waste and scrap, again the appellants have made out a strong case on merits. The demand covering the period November, 1993 to September, 1....
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....tion contained in the statement reproduced or is derived from information supplied to the computer in the ordinary course of the said activities." 19. Ld. Sr. Counsel has argued that the above mentioned conditions were not fulfilled. The computer was not shown to have been used regularly to store or process information for the purposes of any activities regularly carried on by the company. It was also not shown that information of the kind contained in the computer print-out was regularly supplied by the Company to the computer of the appellant in the ordinary course of activities. Again, it was not shown that, during the relevant period, the computer was operating in the above manner properly. The above provision also casts a burden on the party who wants to rely on the computer print-out, to show that the information contained in the print-out had been supplied to the computer in the ordinary course of business of the company. We find that none of these conditions was satisfied by the Revenue in this case. 20. The essentiality of fulfillment of the said parameters in respect of computer printouts has also been reiterated in para 5 of the order in the case of Premium Packaging P....
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....s regard demand on the basis of figures in the loose slips, it is admitted that the loose slips were found in the guest house and not in the factory premises. On perusal of the panchnama at page 77 of the appeal memo, it is observed that the place from which such loose slips were recovered is not stated therein. The author/scribe of the said loose slips is not identified. The loose slips are therefore unauthenticated and it is hard to place reliance on such unauthenticated piece of documents recovered from a place other than factory premises. More over there is no corroborative evidence to suggest correctness of the figure recorded in the loose slips. Therefore, the demand of duty on the basis of figures in such unauthenticated and uncorroborated piece of evidence is unsustainable. (iii) Demand based on Production calculated on the basis of electricity consumption The method adopted by the department in the present case for calculating per metric ton consumption of electricity is stated in para 14 of the impugned order. As stated therein the total production of the finished products i.e. TMT Bar/Saria was arrived at by adding (i) the production shown by the appellant company in t....