TaxTMI 
TaxTMI 
2022 (3) TMI 272
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....terms of the provisions of Section 11AB of the Central Excise Act, 1944 from M/s. M/s. Pyro Electric And Allied Instruments Pvt. Ltd., Mahim (West), Mumbai-400 016. (c) I impose a penalty of 51,35,195/- on M/s. Pyro Electric And Allied Instruments Pvt. Ltd., Mahim (West), Mumbai-400 016 under Section 11AC of the Central Excise Act, 1944, read with Rule 25 of the Central Excise Rules, 2002. (d) I impose penalty of 10,00,000/- each on Shri Madhusudan Dattatray Bichu, Managing Director, Shri Ramnath Madhusudan Bichu, Director and Shri Dattatray Madhusudan Bichu, Director all of M/s. Pyro Electric and Allied Instruments Pvt. Ltd., Mumbai and Shri Shyam Sadanand Bichu, General Manager of M/s. Pyro Electric Instruments Goa Pvt. Ltd. under Rule 26 of the Central Excise Rules, 2002. 2.1 An investigation was undertaken against the Company, and after completion of investigations, following allegations were made against the Company and its Directors:- "6.1 From the above the investigating officer came to the conclusion that M/s. Pyro Mumbai are not vided for benefit of SSI exemption in view of the Notification No.08/2003 dated 01.03.2003 or as mended, as it envis....
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....cluded that, M/s.Pyro Mumbai were not eligible to avail the benefit of Notification No.08/2003 dated 01.03.2003 as amended and accordingly the demand for central excise duty evaded has been worked out for M/s. Pyro Mumbai from November 2005 onwards. 7. In view of the foregoing, the investigating agency found that M/s. Pyro Mumbai through their above acts of omission and commission have deliberately willfully and with an intent to evade payment of central excise duty contravened the provisions of section 4 & 6 of the Central Excise Act, read with rules 4,6,8,9,10,11,12 of the Central Excise Rules, 2002, in as much as it has manufactured and cleared the excisable goods clandestinely to their customers without : 7.1 Obtaining the Central Excise Registration for manufacture and clearing of excisable goods, as was required under the Section 6 of the Central Excise Act, 1944, read with rule 9 of the Central Excise Rules, 2002. 7.2 Determining the correct value of goods manufactured and cleared, as was required under section 4(b) of the Central Excise Act, 1944. 7.3 Determining the correct central excise duty liability on the goods, as was required unde....
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.... at M/s Pyro Mumbai were liable to Central Excise duty, Shri M.D. Bichu was bound to declare all goods manufactured by them and clear the same on valid invoices by discharging the applicable duties. Since Shri M.D. Bichu has failed to comply with such statutory obligations, he has, thus, rendered himself liable for penal action under rule 26 of the Central Excise 2002 as amended. 11. It further appears that the notices no.4, 5 and 6 being General Manager and Directors actively of M/s. Pyro Mumbai have acted in aiding and abetting the alleged manufacturing and removal of excisable goods without payment of central excise duty by noticee no.1. Thus, it appears that notice no.4, 5 and 6 have concerned themselves with the removal, storage, concealment, transportation of the said goods and/or otherwise have dealt with the same, which they knew or had reason to believe that the same are liable for confiscation, under the provisions of the Central Excise Act, 1944 and the Rules made thereunder and hence, they appear to be liable to penal action under the provisions of rule 26 of the Central Excise Rules, 2002." 2.2 On the basis of above allegations a show cause notice dated 07.....
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....aration under the SVLDRS-2019 and could have got the matter settled in their individual cases, in terms of reply to Question No 40 of FAQ's issued by CBIC on the scheme, which is reproduced below: Q40. If the main noticee avails benefit of the Scheme whether Directors whose appeals are pending in respect of penalty only get a waiver of the penalty? Ans. Once the main noticee discharges the duty/tax demand, the co-noticees can avail the benefits under the Scheme. 1.4 At Question No 42 of FAQ's following has also been stated: Q42. If I file a declaration under the Scheme, will it be assumed that I have admitted to the position and agree with the allegations made in the show cause notice? Ans. No. A declaration under the Scheme will not be a basis for assuming that the declarant has admitted the position and no fresh show cause notice will be issued merely on that basis. 4.4 Thus the declaration made by the Company for settlement of its case under the SVLDRS-2019 cannot be termed as admission of the case of revenue by the appellants. 4.5 Commissioner has while imposing the penalties on the appellants has observed as follows: ....
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....e well aware of prescribed procedure and Rules in relation to Registration. Thus the act of applying for Central Excise Registration for DTY Section by Misstating the facts indicate disregard to the legal provisions. The act of omission & commission committed by the Noticee No 3 & 4 revealed that they have not ensured adherence to the Law & procedure of Central excise but intentionally concerned themselves with the mis-declaration & were also instrumental in removal of impugned excisable goods without payment of appropriate duty & therefore cannot escape from penal action & thereby rendered themselves liable for penal liability under the provisions of Rule 26 of Central Excise Rules, 2002." 3.3 Rule 26 of the Central Excise Rules, 2002 reads as follows: " (1) Any person who acquires possession of, or is in any way concerned in transporting, removing, depositing, keeping, concealing, selling or purchasing, or in any other manner deals with, any excisable goods which he knows or has reason to believe are liable to confiscation under the Act or these rules, shall be liable to a penalty not exceeding the duty on such goods or two thousand rupees, whichever is higher."....