AI Drafter 
TaxTMI 
TaxTMI 
2024 (10) TMI 816
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....ers have challenged the impugned Order-in-Original No.MDU-CEX-COM-07 & Order-in-Original No.MDUCEX- COM-08 dated 22.12.2017 passed by the fifth respondent Commissioner of CGST & Central Excise. 3. By the impugned orders, the fifth respondent has confirmed the demand proposed in Show Cause Notice No.01/2016-CE dated 01.01.2016 and Show Cause Notice No.33/2017-CE dated 04.04.2017. Operative portion of the impugned orders dated 22.12.2017 reads as under:- ORDER (i) I treat both the firms M/s Annai Poly Packs, registered in the name of Shri. M.Ahamed Ibrahim, and M/s.Banu Poly Packs registered in the name of Smt.Fatima Banu, wife of Shri.M.Ahamed Ibrahim as single manufacturer for the purpose of commuting the Central Excise duty as the proprietor of M/s Annain Poly Packs, who has all control over of both firms and manufacturing and a clearing PP/HM Sheets and Bags from the said two factories in terms of Section 2(f) of Central Excise Act 1944 (which defines "manufacturer") read with condition nos. 2(v) and 2(vii) of the SSI Exemption Notification No. 8/2003-CE dated 01-3-2003 as amended. (ii) I confirm the clubbing of the value of clearances of PP/HM Sheets and ....
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.... and subsequently cleared without payment of Excise Duty, during the period from January 2012 to May 2016, under sub Section 4 of section 11A of Central Excise Act, 1944. (viii) I appropriate Rs. 3,20,207/- Bank Guarantee amount of M/s.Annai Poly Packs which is 25% on execution of B-11 Bond for Rs. 12,08,826/- the value of seized Poly bags in quantity of 9852.51 kgs. executed at the time of provisional release of said seized goods. (ix) I impose a penalty of Rs. 2,61,31,886/- (Rupees Two Crore Sixty One Lakh Thirty One Thousand Eight hundred and Eighty Six only) on Shri.Ahamed Ibrahim under Section 11AC of the Central Excise Act, 1944 read with Rule 25 of Central Excise Rules 2002 for the suppression of the facts with an intent to evade payment of duty, as discussed supra in detail. (x) I impose a penalty of Rs. 5,000/- (Rupees Five thousand only) on Shri.Ahamed Ibrahim under Rule 27 of the Central Excise Rules 2002, for the breach of Rule 9, in as much as he has not registered his firms APP and BPP even after the actual aggregate value of clearance of PP/HM Sheets and Bags manufactured in APP and BPP exceeded the exemption limit of Rs. 1.5 Crores provide....
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....hat the request was made at the earliest point of time along with reply to the Show Cause Notice No.33/2017-CE dated 04.04.2017. The similar request was once again made by the petitioners during the personal hearing on 25.10.2017. 6. It is submitted that the impugned orders are nullity in view of the decision of the Hon'ble Supreme Court in Andaman Timber Industries Vs. Commissioner of Central Excise, Kolkatta-II, (2016) 15 SCC 785. A reference is made to paragraph 6 from the said Judgment which reads as under:- "6. According to us, not allowing the assessee to cross-examine the witnesses by the adjudicating authority though the statements of those witnesses were made the basis of the impugned order is a serious flaw which makes the order nullity inasmuch as it amounted to violation of principles of natural justice because of which the assessee was adversely affected. It is to be borne in mind that the order of the Commissioner was based upon the statements given by the aforesaid two witnesses. Even when the assessee disputed the correctness of the statements and wanted to cross-examine, the adjudicating authority did not grant this opportunity to the assessee. It w....
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....ven during the course of hearing, the request of the petitioners for cross-examination was recorded and it was stated that there was no corroborative evidence and therefore, the request of the petitioners for cross-examination could not be accepted and agreed. 11. I have considered the arguments advanced by the learned Senior Counsel for the petitioners and the learned Senior Standing Counsels for the respective respondents. 12. The impugned order is common in both Writ Petitions. By the impugned orders, the value-based Exemption Notification No.8/2003-CE dated 01.03.2003 for the period from January 2012 to May 2016 was sought to be denied by clubbing the clearance of both units. Both the units are located in the following address:- W.P.(MD) No. Name Address 5447/2018 M/s.Annai Poly Packs No.103/7, Aruppukkottai Road, East of Railway Bridge, Virudhunagar 5501/2018 M/s.Banu Poly Packs No.3/2A, Kullursanthai Road, Virudhunagar. 13. However, statements of the proprietors of the respective units are inculpatory in nature. The impugned orders predominantly placed reliance on the records retrieved from the respective petitioner's premises. The prop....
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....Tirunelveli, through Annai Velankanni to Thiruvananthapuram, through Parasakthi Transport to Nagercoil, through Balaji Transport to Kollam and Kottiyam; * his sale proceeds were mostly received in cash; * cash and cheque were paid for the procurement of PP Granules; * he has followed the practice of selling half of PP bags without bills and half of PP Bags with bills; * though he knew the sale of PP bags without bills is an offence as per Central Excise Law, due to stiff competition in the PP Bags market and the unwillingness of the customers to pay such duties he was compelled to adopt the aforesaid practice of selling PP bags without bills; * he has been paying approximately Rs. 1.25 lakhs for Electricity consumption which is being paid once in two months; * he has been using Virgin quality of PP granules in the manufacture of PP Bags. 15. Mr.A.Gnanasekar, the Supervisor-cum-Manager of both the petitioners in his statement which has been recorded in paragraph 17.4 of the impugned order has stated as follows:- Statement of Shri A.Gnanasekar, Accountant 17.4. A statement was recorded from Shri A.Gnanasekar, ....
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....point that arises for consideration in this Writ Petition is whether the decision of the Hon'ble Supreme Court in Andaman Timber Industries Vs. Commissioner of Central Excise, Kolkatta-II, (2016) 15 SCC 785, content of which has been extracted above, can be applied to the facts of the present case, particularly regarding remitting back the case to the respondents? 17. The decision of the Hon'ble Supreme Court in Andaman Timber Industries case (referred to supra), content of which has been extracted above, was distinguished by the Hon'ble Division Bench of this Court in S.Rajendran Vs. The Joint Commissioner of Customs (Preventive) and others vide order dated 30.01.2019 in W.A.(MD)No.1469 of 2018. Relevant paragraphs reads as under:- "30. Therefore, denial of cross-examination of co-accomplice who have allegedly retracted their statements is of no consequence as far as the appellant is concerned. 31. Further, in a quasi-judicial proceeding, a quasi judicial authority is not governed by strict rules of evidence. Charge/case can be proved based on preponderance of probability and other available evidences and documents. 32. We are of the view ....
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....orily such statements would require cross-examination and without cross-examination, confirmation of demand would be contrary to the law settled by the Hon'ble Supreme Court in Andaman Timber Industries Vs CCE referred to supra. 62. If reliance is to be placed on any statement of any person as a witness, the 1st respondent is enjoined to issue summons and produce such persons for cross examination, unless of course such person is a co-accomplice of the noticee or an employee of the noticee. 63. Therefore, it is for the 1st respondent to issue summons to these two employees of CHA's for being present for cross-examination if the 1st respondent is of the view that reliance has to be placed on the statement of these persons before passing an order in the said show cause proceeding. 64. Therefore, 1st respondent may inform the petitioner whether it proposes to confirm the demand solely based on the statements of the persons whose statements have been recorded under Section 108 of the Customs Act, 1962 and if that be so, produce them for cross examination by the petitioner. 65. As far as the alleged use of threat while recording statements and....