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TaxTMI 
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2024 (10) TMI 9
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....002 (for short the 'Rules'). 3.1. The brief facts of the case are that the petitioners of Special Civil Application No. 5485 of 2023 purchased the grey fabrics from the petitioner of Special Civil Application No. 6136 of 2023 after payment of excise duty on the processed fabrics. The petitioner-M/s. Rani Sati Impex which is a merchant exporter thereafter exported such grey fabrics and submitted the four rebate claims of Rs. 9,86,303/- as under : Sr.No. ARE-1 No. &Date Invoice No. & Date Shipping Bill No. & Date Qty. Amount of rebate claim (Rs.) 1 1/RI/04-05 dated 14.4.04 001/14.4.04 2746800/4.5.04 6034.25 2,77,575/- 2 2/RI/04-05 dated 14.4.04 003/14.4.04 2746802/4.5.04 5092.75 2,34,266/- 3 3/RI/04-05 dated 14.4.04 002/14.4.04 2753721/7.5.04 2597.50 1,19,485/- 4 4/RI/04-05 dated 14.4.04 004/14.4.04 2746716/4.5.04 7716.90 3,54,977/- 3.2. As a part of scrutiny of the aforesaid refund claims, the respondent conducted the investigation which resulted into the tentative conclusion that the petitioners and other co-accused persons had indulged into tampering the documents like shipping bills, etc. and in creation of forged statutory documents like ARE-I For....
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....d by applying white fluid and by allotting new ARE-1 Nos; whereas in the triplicate copy, the cartoon no., weight, description of goods, etc. are in typed form and in respect of ARE-1 No, no correction or alteration were found. Shri Tulsian deposed that he could not explain as to why there are such correction/ alteration made on ARE-1s as well as the differentiation/variation of the same in original/duplicate vis-a-vis triplicate copy of the respective ARE-1s. He further deposed that after going through the evidence as well as statements shown to him, he confirmed that the original ARE-1 Nos. 441, 442, 443 & 444 all dated 11.5.2004 were tampered subsequently after export of goods and new ARE-1 Nos. 01/RI/04-05, 02/RI/04-05, 03/RI/04-05 & 04/RI/ 04-05 all dated 14.4.2004 were obtained by Shri Kuchubhai/ Shri Manibhai. He also deposed that the original (actual) ARE-1 No. 441, 442, 443 & 444 were not registered with any Central Excise Authority in Surat or elsewhere. He further deposed that the manual amendments done in their aforesaid 4 shipping bills regarding ARE-1 No. and date were forged and not authenticated by any Customs Officers. d) Statement dated 28.2.2006 of Shri Manibha....
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.... Act. 3.7. The petitioners filed a reply dated 28th April, 2014 in response to the show-cause notice and also filed written submissions dated 13th May, 2015 along with photo copies of the relevant documents contending inter-alia that the petitioner M/s. Rani Sati Impex had procured the export goods from M/s. Gomti Exports who had purchased grey fabrics and got them processed from the process house and supplied the same under cover of relevant excise duty, paid invoices issued by the processor. It was also contended that the Form ARE-I No.01/RI/04-05 to 04/RI/04-05 dated 14.04.2004 were obtained from Range-III, Division-I, Central Excise, Surat-I and made entries in the respect thereof in ARE-I Register of the Range and obtained signature of the Range Officer on the four copies of the ARE-I and thereafter, they had made the exports and submitted all export documents like packing list, invoices, shipping bills, mate receipts, bill of lading, Certificate of origin etc. along with Bank Realisation Certificate. Reliance was also placed upon the affidavit of the persons whose statements were recorded during the course of investigation to retract and challenge the veracity of such statem....
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....alty in case of the merchant exporter and the penalty is therefore required to be deleted. 3.14. The Appellate Authority after considering the facts of the case and the submissions made by the petitioners confirmed the order passed by the Adjudicating Authority rejecting the rebate claim as well as the levy of penalties upon the petitioners by the impugned order dated 25.05.2016 observing as under : "6.1 I find that the investigation clearly established that Appellant No. I/Appellant No. II/ Shri Anil Tulsian have in connivance with their Legal Consultant, Shri Vanibhai Patel and their agents Shri Kuchubhai / Shri Dilkumar indulged themselves in preparing ARE-1s by giving imaginary/hypothecated Numbers 441, 442, 443 & 444 (without registering with Central Excise Authority), producing the same before Customs Officers at JNCH, Nhava Sheva for export of goods under Shipping Bill No.2746800, 2746716 & 2746802 all dated 04.05.2004 and 2753721 dated 07.05.2004 and they managed ARE-1 Nos. 1/RI/04-05, 2/RI/04-05, 3/51/04-05 B 4/RI/04-05 all dated 14.04.2004 fraudulently from the jurisdictional Range Office i.e. Range-III, Division-I, Surat-I. Towards this, they tampered with the ARE-1 N....
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.... ARE-1 Nos. 01/RI/04-05, 02/RI/04-05, 03/RI/04-05 & 04/RI/04-05 all dated 14.04.2004 from Appellant No. I, for export of goods under Shipping Bill No: 2746800, 2746716 & 2746802 all dated 04.05.2004 and 2753721 dated 07.05.2004, he had never done any correction in the Shipping Bills regarding ARE-1 No & Date and also not affixed round seal of the Customs. 6.5 I find that Shri Manibhai Patel, Legal Consultant, in his statement dated 04.01.2005 and 28.02.2006 had categorically admitted that he himself had changed ARE-1 Numbers as well as corrected other particulars in original and duplicate copy of respective ARE-1 after shipment of goods and receipt of shipping documents from CHA and also obtained signature of jurisdictional Central Excise Officers on triplicate copy of ARE-1, that the same was done as per the direction of Shri Anil Tulsian/Appellant No. II. 6.6 Further, Appellant No. II in his statement dated 10.08.2005 that ARE-1 No. 441, 442, 443 & 444 all dated 11.05.2004 were subsequently tampered and the ARE-1 No. & Date were changed as 01/RI/04-05, 02/R/04-05, 03/R/04-05 & 04/RI/04-05 all dated 14.04.2004 that as per his knowledge Shri Kuchubhai did all the work related t....
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....e were not genuine. The Case Laws cited by them are not relevant in the present circumstances. 6.9 Appellant No. I, in defense reply dated 28.04.2014 contended that the Show Cause Notice under reply is inherently contradictory in as much as the allegation of presenting 4 ARE1s with numbers 441 to 444 before Customs for exports but not claiming any rebate against those ARE-1s, but tampering with new numbers 1 to 4 and claiming rebate against the same does not contain any reason for such conduct. The said allegation seems to be fanciful invention and does not contain any plausible reason for the conduct alleged. For this reason alone the Show Cause Notice has to fail, Here, I find that M/s. Rani Sati Impex, Surat. Should have filed the rebate claims on the basis of 4 ARE-1s bearing Nos. 441 to 444, which were presented before the Customs Authority for exports under Shipping Bills Nos. 2746800, 2746716 & 2746802 all dated 04.05.2004 and 2753721 dated 07.05.2004 instead of ARE-1 Nos. 01/RI/04-05, 02/RI/04-05, 03/RI/04-05 & 04/RI/04-05 all dated 14.04.2004 which were not produced before the Customs Authority, JNCH. Further, I also find that tampering of the documents which have alread....
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....on that no interference is required in the concurrent findings of facts arrived at by both the authorities observing as under : "6. Government observes that the main reason for rejection of impugned rebate claims was that the applicants had tampered the statutory documents viz. Shipping bill and ARE-1 and presented these documents to Central Excise Department with an intention to avail rebate of Central Excise duty fraudulently. 7. Government finds that initially while verifying the rebate claims filed by the applicant-I, an enquiry was initiated as the value of export goods declared in export documents was very high as compared to the normal value of printed MMF. During the course of investigation, the fraud carried out by the applicants was exposed as detailed at para 10 of the impugned 0I0, which is reproduced hereunder: 10. In view of the above, as well as the material evidences collected / gathered during the course of enquiry, it strongly transpires that M/s. Rani Sati Impex, Surat/Shri Vivek Tulsian/ Shri Anil Tulsian have in connivance with their Legal Consultant, Shri Manibhai Patel and their agent Shri Kuchubhai/Shri Dilkumar indulged in tampering the statutory docu....
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....nly through system before the let export order is given by proper officer. The very fact gets confirmed from the aforesaid verification report from Customs Authority of JNCH, Nhava Sheva, as well as submission / reports of the Customs Officers whose names were purportedly used by aforesaid M/s. Rani Sati Impex, Surat/ Shri Vivek Tulsian/ Shri Anil Tulsian and other persons in fraudulently amending the ARE-I No. in Shipping Bills. The purported correction of ARE-I No. and date in all the four Shipping Bills under reference was done by Shri Manibhai Patel in his own handwriting as per the direction of Shri Vivek Tulsian/ Shri Anil Tulsian, as admitted by Shri Manibhai Patel in his foregoing statements. Further, the ARE-I No. 441, 442, 443 & 444 all dated 11.05.04 produced before Customs Authority are also not genuine since they were not registered with the jurisdictional Central Excise Authority, which is a mandatory provision. Thus, looking to all these evidences, it appears that M/s. Rani Sati Impex, Surat/ Shri Vivek Tulsian had indulged themselves in preparing ARE-Is by giving imaginary/ hypothecated numbers 441, 442, 443 & 444 (without registering with Central Excise Authority),....
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....ly for the purpose of granting the rebate as per the Central Excise Manual which is not mandatory. 4.2. In support of his submissions, reliance was placed on the decision of this Court in case of Raj Petro Specialities Versus Union of India and Others reported in (2017) 345 ELT 496 wherein, in the facts of the said case when the ARE-I Form was misplaced, relying upon the decision of the Hon'ble Bombay High Court in case of U.M. Cables limited versus Union of India reported in (2013) 21 GSTR 522 (Bombay) it was held that all other conditions and limitations are mentioned in clause (2) of the Notification for granting rebate are satisfied and the rebate claim have been rejected solely on the ground of non-submission of original and duplicate ARE-I which could not have been rejected as the petitioner was held to be entitled to the rebate of duty claim for the excisable goods which are in fact exported on payment of export duty from the respective factories. 4.3. Learned advocate Mr. S.S. Iyer for the petitioners submitted that in case of U.M Cables Limited (Supra), the Hon'ble Bombay High Court after considering paragraph No.8 of Chapter-8 of the CBES's Excise Manual of Supplementar....
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....ch the penalty would be leviable. It was pointed out that at the best the petitioners are entitled to the rebate claim and in alternative, no penalty could have been levied upon the petitioners separately by the Adjudicating Authority which is erroneously confirmed by the Revisional Authority without any discussion on the levy of the penalty in the impugned orders. 5.1. On the other hand, learned advocate Mr. C.B. Gupta for the respondent Nos.1 to 4 submitted that there are concurrent findings of facts as well as there is a criminal complaint pending for adjudication under the provisions of the Indian Penal Code filed in the year 2007 and the petitioners are also involved in the fraud by submitting the forged ARE-I Forms for claiming the rebate. 5.2. It is also submitted that during the course of investigation, it was found that even the signatures of the customs Superintendents have been forged for claiming the rebate and therefore, the Adjudicating Authority has rightly rejected the rebate claim and imposed the penalty under Section 11AC of the Act read with Rule 25/27 of the Rules for violations of the mandatory provisions of the Manual of the Instructions of the CBEC. 5.3. I....
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....cate [in case where claimant is other than exporter] 8.4 After satisfying himself that the goods cleared for export under the relevant A.R.E. 1 applications mentioned in the claim were actually exported, as evident, by the original and duplicate copies of A.R.E. 1 duly certified by Customs, and that the goods are of 'duty-paid' character as certified on the triplicate copy of A.R.E.1 received from the jurisdictional Superintendent of Central Excise (Range Office), the rebate sanctioning authority will sanction the rebate, in part or full. In case of any reduction or rejection of the claim, an opportunity shall be provided to the exporter to explain the case and a reasoned order shall be issued. 8.5. Where the individual rebate claim exceeds Rs. 5 lakh, they shall be pre-audited before these are disbursed." 8. On perusal of the above procedure for sanction of the claim of rebate by Central Excise, it is mandatory for the claimant to file original copy of ARE-I. The Form ARE-I is the export document which is prepared in quintuplicate five copies which are similar to erstwhile Form AR-4. Such Forms bear running Serial Numbers beginning from the first day of the financial year. Pa....
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....aud and forged the Forms which is found during the course of investigation as per the concurrent findings of fact arrived at by the three Authorities below. In such circumstances we are of the opinion that the respondent-Authorities have rightly rejected the rebate claim of the petitioner and no interference is called for. 11. So far as the levy of penalty is concerned, learned advocate for the petitioners has vehemently submitted that the show-cause notice dated 28th February, 2014 is beyond a period of limitation as prescribed under Sub-section (4) of Section 11AC of the Act and therefore no penalty could have been levied under the said Section read with Rules 25/27 of the Rules. It was submitted that when the entire show-cause notice is time barred, even the rebate claim could not have been rejected nor the penalty could have been levied. In order to consider such submissions, it would be germane to refer to the provisions of Section 11AC (4) and Rules 25 and 27 which reads as under : "Section 11AC(4): Every notification under clause (f) of the first proviso to sub-section (2) shall be laid before each House of Parliament, if it is sitting, as soon as may be after the issue o....
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....as the original documents were lying with the Court of Sessions and the reminders were sent which were provided by the respondent-Authorities in 2008 to the Police Authorities for investigation and the same were not made available till 2014, show-cause notice was thereafter issued in 2014 cannot be said to be beyond the period of limitation. However, the petitioner has never raised the issue of limitation before the Adjudicating Authority nor the Adjudicating Authority have therefore had any occasion to deal with such a contention raised by the petitioners. However, as the petitioners have raised such contentions before the Revisional Authority and before this Court, as the question of limitation is mixed question of facts and law, we have permitted the petitioners to raise such contention and is accordingly, dealt with. 13. In view of the foregoing reasons, no interference is called for in the impugned orders rejecting the rebate claim and levy of penalty upon the petitioners while exercising the extra-ordinary jurisdiction under Article 227 of the Constitution of India and the petitions therefore being devoid of any merit are accordingly dismissed. Notice is discharged. No order....