TaxTMI 
TaxTMI 
2024 (12) TMI 343
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....aj Tobacco Private Limited A90, Sector-63, Noida, under Rule 14 of Cenvat Credit Rules, 2004 read with Section 11A (10) of the Central Excise Act, 1944; (b) I, order for recovery of interest from them under Rule 14 of Cenvat Credit Rules, 2004 read with Section 11AA of the Central Excise Act, 1944. (c) I, impose a penalty of Rs 59,225/- (Rs. Fifty nine thousand two hundred twenty five) upon them under Rule 15 of Cenvat Credit Rules, 2004 read with Section 11AC of the Central Excise Act, 1944 2. (a) I, confirm the demand of duty of Rs. 75153/- (Rs. Seventy five thousand one hundred fifty three) from M/s Pankaj Tobacco Private Limited, A-90, Sector- 63, Noida under Section 11A(10) of the Central Excise Act, 1944. (b) I, order for recovery of interest from them under Section 11AA of the Central Excise Act, 1944. (c) I, impose a penalty of Rs 75153/- (Rs. Seventy five thousand one hundred fifty three) upon them in terms of Rule 25 of the Central Excise Rules, 2002 read with Section 11AC of the Central Excise Act, 1944 3. (a) I, confirm the demand of duty of Rs. 2,29,955/-(Rs. Two lacs twenty nine thousand nine hundred fifty five) on....
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....atil Transport, C-9, SMA Industrial Area, Jhangirpuri, Deihi, under Rule 26 of the Central Excise Rules, 2002 11. I impose a penalty of Rs 2,00,000/- (Rs. Two lacs only) upon Shri B. S. Kothawale Proprietor of M/s Sri Siddheswar Traders, Shop-11, Kumbharwar Shopping Centre Solapur, Maharashtra, under Rule 26 of the Central Excise Rules, 2002 12. I, impose a penalty of Rs 2,00,000/- (Rs. Two lacs only) upon Shri H. M. Kasar Proprietor of M/s Shree Sai Agencies, 299, Satakar Chal, Mangalwar Peth, Sangli Madhavnagar, Maharashtra, under Rule 26 of the Central Excise Rules, 2002 13. I, impose a penalty of Rs 2,00,000/- (Rs Two lacs only) upon Shri Manoj Kumar Patil Proprietor of M/s Siddaram Traders, Shah Peth. Bijapur, Karnataka, under Rule 26 of the Central Excise Rules, 2002. 14. I, impose a penalty of Rs 2,00,000/- (Rs. Two lacs only) upon Shri Srinivas Hegde, Proprietor of M/s Vishal Enterprises, Aditi Chamber, Hugar Oni, Hubli, Karnataka, under Rule 26 of the Central Excise Rules, 2002 15. I, impose a penalty of Rs 2,00,000/- (Rs. Two lacs only) Shri N. G. Mohan, Proprietor of M/s Sri Ram Stores, C V Complex, Station Road, Davangere Kar....
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....improper accountal of such excess stock was for the purpose of unaccounted manufacturing and clandestine ciearances of the finished excisable goods, in contravention to Rule 10 of Central Excise Rules 2002, with the intention to evade Central Excise Duty due thereon, the said goods (i.e. 102 Kg. of Aradhna Zafrani Patti No. 311 of 50 gms. contained in 10 Cartons and 85.26 Kg. of Aradhna Zafrani Patti No 311 of 200 gms. contained in 21 Cartons) were seized under Section 110 of Customs Act, 1962 as made applicable to Section 12 of Central Excise Act 1944 read with Rule 24 of Central Excise Rules, 2002 vide Seizure Memo dated 12.4.2012 and were handed over to Shri Pradeep Kumar, Director, for keeping the said goods in safe custody under Supurdnama dated 12.04.2012. 2.4.2 The physical verification of the stock of packing material was also conducted by the officers. Since the goods were not verifiable vis a vis book balance as the party was not maintaining any stock account of packing materials, the stock of packing material, i.e. empty tin containers, were detained by the officers and Shri Pradeep Kumar, Director, was suitably instructed not to deal with or dispose off the aforement....
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....lso initiated at local office of M/s G.G.Carrier, Agra Road, Jaipur situated at Harola Market, Sector 5, Noida on 13.04.2012. Thè above address was identified during the search of the Residential premises at 1-23, Sector-12, Noida by the officers on 11.04.2012 wherein copies of 6 (six) GRs issued by M/s G.G.Carrier, Agra Road, Jaipur were resumed. It was observed that M/s Hariom Krishna Transport Company, Harola Market, Sector-5, Noida was acting as an agent of M/s G.G.Carrier. There were no premises of M/s G.G. Carrier. A Panchnama dated 13.04.2012 was also drawn of the proceedings conducted and statement of Shri Rajneesh Kumar Trehan, owner of M/s Hariom Krishna Transport Company was also recorded under section 14 of the Central Excise Act, 1944 2.9 Appellant 1 vide letter Ref. No. 003/12-13 dated 30.4.2012 had intimated that they had deposited an amount of Rs. 5,00,992/- as pre- deposit against Panchnama dated 11/12.04.2012, under protest. The stock of packing material, i.e. empty tin containers, detained by the officers vide Detention Memo dated 12.04.2012 (mentioned at para 3.1 above) was seized by the Department vide Seizure Memo dated 06.07.2012 valuing Rs. 5,62,45....
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....e. Pan masala containing tobacco; that, the ingredients or raw material used in manufacture of Gutkha are Supari, Kattha, Menthol, Lime, Tobacco, Spices and Fragrances; that, they had never used Magnesium Carbonate in manufacture of Gutkha in factory; that, they had never purchased Magnesium Carbonate for their factory; that, they had never manufactured pan masala in their factory; that, they did not use any anti caking material as they use paper foil aluminium coated for packing of their finished goods; that, they purchase high quality katthaa and mix with lime to maintain whiteness in the product. 2.14 On 17.04.2013. on the basis of specific information received regarding the clandestine removal of 'flavoured Chewing Tobacco' by PTPL, a team of officers of Anti Evasion branch of Central Excise, Commissionerate Noida was put on surveillance near Padam Petrol Pump, Sector-63, Noida to intercept a vehicle transporting clandestinely cieared consignment of flavoured Chewing Tobacco by PTPL. Simultaneously, the factory premises of PTPL were also kept under surveillance by the officers of Anti Evasion branch of Central Excise, Commissionerate Noida. At around 19.30 Hrs, a veh....
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....7-E, Pune- Bangalore Road, Kolhapur. Apart from the aforesaid papers, driver Shri Umesh Yadav could not produce any valid Central Excise duty paying documents 2.15.3 Further, on verification of Flavoured Chewing Tobacco/ Zarda loaded on the truck it revealed that out of the 63 cartons * 13 cartons were of Aradhna Brand Tobacco Special-311, each carton having 20 packets and each packet contained 10 tin containers i.e. total 13*20*10 = 2600 tin container (each of 50 gms. of M.R.P. Rs. 85/-), total M.R.P. Rs. 2,21,000/-, after abatement of 55% Ass. Value Rs. 99,450/- * 50 cartons were of Aradhna Brand Zafrani Patti No. 311 Super pouch, each carton having 20 packets and each packet contained 11 pouches i.e. total 50*20*11 11000 pouches (each 50 gms. M.R.P. Rs. 63/-). Total M.R.P. Rs. 6,93,000/-, after abatement of 55% Ass. Value Rs. 3, 11,850/- * Total 63 cartons of flavoured chewing tobacco, involving total Assessable Value of Rs. 4,11,300 involving central excise duty amounting to Rs. 3,21,965/- 2.15.4 Enquiry was made on the spot on 17.04.2013 from Shri Umesh Yadav, Driver of vehicle/truck Swaraj Mazda Registration No. UP-16 E-4970. Shri Umesh Yadav ....
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....oods and the vehicle/truck Swaraj Mazda Registration No. UP-16 E-4970 were handed over to Shri Neeraj Kumar, Authorised Signatory of M/s PTPL for safe custody under Supurdnama dated 17.04.2013 2.16.2 During search, stock of raw material and packing material was also taken and on reconciliation details as per the statement Appellant 5 dated 23rd April, 2013, shortage in the stock of raw material and packing material was observed. 2.17 The follow up search operations were conducted at the premises of M/s Ghatge Patil Transport, C-9, SMA Industrial Area, Jhangir puri, Delhi in the presence of Shri Kanwar Singh Yadav, Branch Manager of M/s Ghatge Patil Transport, C-9. SMA Industrial Area, Jehangir puri, Delhi on 18.04.2013 as they were concerned with transporting clandestine finished goods manufactured and cleared by M/s PTPL. Search of the premises resulted in recovery of two consignments of flavoured chewing tobacco of Aradhna Brand Zafrani Patti No. 311 Super of 20 cartons each. On being asked Shri Kanwar Singh Yadav, Branch Manager of M/s Ghatge Patil Transport, C-9, SMA Industrial Area, Jhangir puri, Delhi informed that the said consignments were booked by Appellant 6. Shri ....
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...., Delhi under Panchnama dated 18.04.2013. 2.18.3 Appellant 6 vide letter dated 23.04.2013 requested for provisional release of vehicle/truck Swaraj Mazda Registration No. UP-16 E-4970 valued at Rs. 1,50,000/- which was seized along with 63 cartons of Flavoured Chewing Tobacco near Padam Petrol Pump, Sector-63, Noida under Panchnama dated 17.04.2013. 2.18.4 The request for provisional release was allowed by the Additional Commissioner (Pc Div-II), Central Excise, Noida vide the Provisional Release Order issued under C.No. IV- CE(9)CP/N/65/13/728 dated 03.05.2013 (RUD-31) on furnishing of B-11 (Security) Bond for Rs. 6,60,780/- (for the seized goods) and Rs. 1,50,000/- (for the seized vehicle) along with Fixed Deposit for Rs. 1,65,195/- and Rs. 37,500/- respectively. 2.18.5 A seizure show cause notice vide C. No. IVCE(9)CP/N/65/13/ 1538-1544 dated 09.10.2013 was issued to M/s PTPL for confiscation of 63 cartons of Flavoured Chewing Tobacco and Zafrani Patti valued at Rs 4,11,300/- seized near Padam Petrol Pump, Sector-63, Noida on 17.04.2013 and 40 cartons of Flavored Chewing Tobacco. valued at Rs. 2,49,480/- seized at the premises of M/s Ghatge Patil Transport, C-9, SMA Ind....
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....ket, Near Water Tank, Barola, Noida-II, M/s Rishabh Trading Company Noida, M/s Pooja Traders, Noida and M/s Aamir Enterprises, Noida; • the GRs / Way bills submitted by M/s Ghatge Patil Transport Limited, Delhi pertains to the consignments of Tobacco / Zarda booked on the bills of M/s Vishwakarma Trading Co. Noida, M/s Rishabh Trading Co. Noida, M/s Pooja Traders, Noida and M/s Aamir Enterprises Noida- which were cleared clandestinely from the factory of Appellant 1; • GRs /way bills submitted by M/s Ghatge Patil Transport Ltd, Delhi on which finished goods manufactured by M/s PTPL, Noida, were cleared without payment of duty pertain to the period January, 2012 to April 2013. • During this period they were packing 200 Tin containers of 50 gms each of MRP Rs. 85 in each carton and 220 pouches of 50 gms. each of MRP Rs. 63 were packed in each carton; the Aradhna Brand Zarda cleared by us are in Tin containers of 50 gms but the customers like Amit Agency / Trading, Aurangabad Bharat Trading, Hyderabad, Siddaram Traders, Bijapur, and Modern Tobacco/ Zarda, Latur have always purchased Aradhna Brand Zarda chewing tobacco in 50 gms pouch only; that h....
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.... cenvatable goods of quantity of 325 kgs., whereas the qty. of 1375 kgs. of such goods was non cenvatable. They had availed the Cenvat credit of Rs. 57,500/+Rs 1150/-+ Rs. 575/- =Rs. 59,225/- vide RG23A Pt.-II E/No.1 dated 10.02.2012 on 325 Kgs. of the raw material Flavors' found short 2.25 Accepting the facts of manufacture and clandestine removal of goods without payment of Central Excise duty, PTPL deposited Rs.48,26,992/- vide the following e- payment Challans against their liability Sr. No Challan No. Date Amount (in Rs.) 1 02005293004201200068 30.04.2012 5,00,992/- 2 02005293012201300142 30.12.2013 10,00,000/- 3 02005291001201400092 10.01.2014 8,00,000/- 4 02005291501201400049 15.01.2014 15,26,000/- 5 02005292662201400059 26.02.2014 10,00,000/- Total 48,26,992/- 2.26 Thus, it is evident that Appellant 1 was suppressing the production and clandestine removal of finished goods in a well planned and systematic manner with intent to evade payment of Central Excise duty. On scrutiny of the seized records, confessional statements of various persons including the Directors and employees of the co....
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....on inputs / raw materials amounting to Rs. 59,225/-used in the unaccounted production and clandestine clearances of the excisable goods by them 2.28 A show cause notices dated 02.02.2015 was issued to the appellant 1 asking him to show casue as to why: 1. (a) The CENVAT credit amounting to Rs. 59,225/(including Ed. Cess & Higher Ed. Cess) involved on the raw material (flavors and saffrons) found short during physical stock taking of raw materials at the factory premises at A90, Sector-63 Noida, on 11/12.04.2012, should not be recovered from them under Rule 14 of Cenvat Credit Rules, 2004 read with Section 11A (4) of the Central Excise Act, 1944 (b) Interest should not be demanded from them under Rule 14 of Cenvat Credit Rules, 2004 read with Section 1 IAA of the Central Excise Act, 1944, and Penalty should not be imposed upon them in terms of Rule 15 of Cenvat Credit Rules, 2004 read with Section 11AC of the Central Excise Act, 1944 2. (a) The duty amounting to Rs. 75153/-(including NCCD, AED, Ed. Cess & Higher Ed. Cess) involved on the excisable goods namely Scented Patti found short during physical stock taking in the factory premises at A-9....
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.... adjudicated as per the impugned order. Aggrieved appellants have filed these appeals. 3.1 We have heard Shri S D Gaur, Advocate for the appellant and Shri Tuleshwar Parsad & Santosh Kumar, authorized representative for the revenue. 3.2 Arguing for the appellant learned counsel submits,- • From the impugned order as made by the learned commissioner it is not clear except S.No.1 on what goods demand has been confirmed. • In respect of Cenvat Credit amounting to Rs. 59,225.00 it was submitted that inputs involved were used in manufacturer of final products and were never cleared out of factory. This mistake was clerical and there is no evidence to established that the input was ever cleared out of factory. The demand made is not proper and demand of interest is not justified and penalty imposed is not justify and legal. • In respect of demand of Rs. 75153.00 it was submitted that scented patti on which demand appears to be made and found short is not proper reasonable & correct. As scented patti was lying in the intermediary stage of production. The goods under question are not final product, therefore demand of duty of such goods is not p....
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....o appear for cross examination. 3.3 Authorized representative reiterated the findings recorded in the impugned order. 4.1 We have considered the impugned order along with the submissions made in appeal and during the course of arguments. 4.2 Impugned order records the findings as follows: "29. I have carefully gone through the show cause notice, written submissions made by the parties and other case records. I observe that the issues to be decided in the present case are as under: (i) whether the CENVAT credit amounting to Rs. 59,225/- involved on the raw material (flavors and saffrons) found short is recoverable from M/s Pankaj Tobacco Pvt. Limited under Rule 14 of Cenvat Credit Rules, 2004 read with Section 11A (4) of the Central Excise Act, 1944, interest is demandable from them under Rule 14 of Cenvat Credit Rules, 2004 read with Section 1 IAA of the Central Excise Act, 1944, Penalty is imposable upon them in terms of Rule 15 of Cenvat Credit Rules, 2004 read with Section 11AC of the Central Excise Act, 1944 (ii) whether the duty amounting to Rs. 75153/- involved on the excisable goods namely Scented Patti found is recoverable from M/s Pankaj To....
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....ders, Shri Srinivas Hegde, Proprietor of M/s Vishal Enterprises, Shri N. G. Mohan, Proprietor of M/s Sri Ram Stores, under Rule 26 of the Central Excise Rules, 2002. 2. Now I proceed to decide the above issues one by one. 1 find that various premises were searched on 11.04.2012 by the department. The factory premises of PTPL situated at A-90, Sector 63, was searched under Panchnama proceedings as per Panchnama dated 11/12.04.2012 drawn in the presence of two independent witnesses. The officers physically verified the stock of the finished excisable goods lying in the factory premises of the party. Stocks of the finished goods namely `Aradhna' zafrani patti No. 311 of 50 Gms. W. K., `Pritam' No. 319 (50Gms) Scented patti, `Rajkiran Quiwam' (50Gms) scented patti and 'Kiran' No. 06 scentedpatti were found short by 11.800 Kgs, 27.900 Kgs, 2.730 Kgs and 449.75 Kgs respectively, involving Central Excise duty of Rs. 75129/ (i.e. Rs. 6544/- +10444/- +1811/-+56330/ respectively) The physical verification of the stock of raw material/packing material was also conducted by the officers. I find that the goods were not verifiable vis-a-vis book balance as t....
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....s not acceptable as the scented patti is a finished excisable goods and are liable to be recorded in the RG-1 register. In view of above, I find that the central excise duty of Rs 75153/- involved in the scented patti found short in the factory at premises situated at A-90, Sector 63, Noida is recoverable from PTPL under Section 11A(4) of the Central Excise Act, 1944 along with interest under Section 11AA of the Central Excise Act, 1944. I find that the cenvat credit of Rs 59225/- involved in cenvatable flaours found short in the factory at premises situated at A-90, Sector 63,Noida is recoverable from PTPL under Rule 14 of Cenvat Credit Rules, 2004 read with Section 11A(4) of the Central Excise Act, 1944 along with interest. 3. During the search of the Residential premises situated at 1-23 Sector-12, Noida by the officers on 11.4.2012, which belongs to Shri. Pradeep Kumar Arya Director of PTPL, copies of 6 (six) GRs bearing serial Nos.14514, 14515, 14516 and 14517 all dated 20.02.2012 (in original), 14505 dated 15.02.2012 and 14508 dated 16.02.2012 (both in Xerox copies) issued by M/s G.G.Carrier, Agra Road, Jaipur were recovered. A follow up action was initiated at local....
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....nce direct or corroboratory that goods manufactured by M/s PTPL, were removed ciandestinely to the consignee at Bangalore. The party in the personnel hearing also requested for cross examination of transporter and consignee (iv) I find that the GRs in question have been recovered from the residence of one of the director of M/s PTPL viz Shri Pradeep Kumar Arya. I find that Shri Om Prakash, Supervisor of PTPL, has confirmed that the GRs, were issued for dispatch of Pan Masala cartons from the factory premises of PTPL to Bangalore and the goods were manufactured by PTPL and cleared from the premises of PTPL on the instruction of Shri Pradeep Kumar Arya, Director of PTPL. Further, I find that Shri Rajneesh Kumar Trehan, owner of M/s Hariom Krishna Transport Company on seeing the 6 No.s of GRs, stated that masala was transported vide those 6 GRs. He further stated that he had sent Pan Masala on these GRs from M/s Hariom Traders, Noida to M/s Krishna Pan House, Bangalore. I see no motive in the statements of Shri Om Prakash, Supervisor of PTPL who having been the supervisor of PTPL, has the first hand knowledge about the goods. Above admission of Shri Om Prakash negates PTPL....
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.... sale of 33 cartons (6600 Pcs) of Aradhna No.311 brand of flavoured chewing tobacco valued at Rs. 3,25,614/- These Tax/Sale Invoices and Challan/Transfer Invoices were found not accompanied by any transport documents (ii) Bills/Cash Memo issued by M/s Vishwakarma Trading Co., found to be issued to M/s Hemant Kesar & Co., 1474, Rishala Road, Sangheshwar Tower, Madhav Nagar, Sanghi for sale of 30 cartons of manufactured tobaccc valued at Rs. 1,19,700/-, M/s Bharat Trading Co., Begum Bazar, Hyderabad for sale of 20 cartons of manufactured tobacco valued at Rs. 77,520/-and M/s R.K Trading Co., Sainath Ganj, Begum Bazar, Hyderabad for sale of 13 cartons of manufactured tobacco valued at Rs. 53,352/- respectively. These bills/Cash Memos were also accompanied with Bilty / Way Bill No 2416335, 2416333 and 2416334 all dated 17.4.13 issued by M/s Ghatge Patil Transport Ltd., H.O. 517-E, Pune-Bangalore Road, Kolhapur. Apart from the aforesaid papers, driver Shri Umesh Yadav could not produce any valid Central Excise duty paying documents (iii) Further, on verification of Flavoured Chewing Tobacco/ Zarda loaded on the truck it revealed that out of the 63 cartons - * ....
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....Aradhna Brand Zafrani Patti No. 311 valued at Rs. 4,11,300/- involving Central Excise duty of Rs 3,21,965/- manufactured by M/s PTPL were seized. Since the vehicle/truck Swaraj Mazda Registration No. UP-16 E-4970 valued at Rs 1,50,000./- was being used for transportation of clandestinely cleared goods which were liable to central excise duty, the same was also seized (vi) During search of factory premises of PTPL on 17.04.2013, stock of raw material and packing material was also taken and the following shortage in the stock of raw material and packing material was found:- Sr. No. Name of Item Quantity found short Value (in Rs.) Duty @ 12.36% (in Rs.) 1 Empty tin containers of 50 Gms and 200 Gms 59579 in No 5,56,178/- 68744/- 2 Raw Tobacco 2495 Kgs 1,53,630/- 3 Essence & Flavors 2137.171 Kgs 8,75,510/- 1,08,213/- 4 Spices 269.227 Kgs 32,216/- 3982/- 5 Silver foil 0.425 Kgs. 24,969/- 3086/- TOTAL 184025/- (vii) I find that during the follow up search operations of M/s Ghatge Patil Transport, C-9, SMA Industrial Area, Jhangirpuri, Delhi two consignments of flavoured....
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....cartons) seized on 18.04.2013 from the premises of M/s Ghatge Patil Transport, C-9, SMA Industrial Area, Jhangirpuri, Delhi covered under the bills of M/s Vishwakarma Trading Co., Bhardwaj Market, Barola, Noida were also manufactured and cleared from M/s PTPL without issue of excise invoice; that, admitting their liability, they will voluntarily deposit the duty involved on the consignment that were seized on 17.4.2013 and 18.4.2013. I find that Shri Pankaj Kumar, Director of M/s PTPL in his statement agreed with the contents and facts narrated by Shri Neeraj Kumar, Authorised Signatory. of the M/s PTPL. (ix) Shri Yogendra Kumar Sharma, Proprietor of M/s Om Roadways Corporation stated that they were the Booking agent for M/s Ghatge Patil Transport Ltd., C- 9, SMA Industrial Area, Jehangirpuri, Delhi and that that all work related to his transport company was looked after by his son Shri Deepak Sharma. Shri Deepak Sharma admitted that they were booking agent for M/s Ghatge Patil Transport Ltd. and that for booking of goods they were supplied Bilty Book and Challan Book by M/s Ghatge Patil Transport. 1 find that Shri Deepak Sharma also admitted that papers pertaining to said....
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....oida; that he confirmed that all the consignments of Tobacco / Zarda booked on the bills of M/s Vishwakarma Trading Company, Noida, M/s Rishabh Trading Company Noida, M/s Pooja Traders, Noida and M/s Aamir Enterprises, Noida were loaded from the factory of M/s PTPL, A-90, Sector-63, Noida; that all these bookings were on "TO PAY" basis and payments were received by them at the destination from the consignee. (xii) I find that Shri B. S. Kothawale, Propreitor of M/s Sri Siddheshwar Traders submitted that his firm used to purchase Aradhna Brand Zarda manufactured by M/s PTPL, Noida, both on bills and without bills. The unaccounted consignments of Aradhna Brand Zarda were delivered to them at Solapur on the bills of M/s Vishwakarma Trading Company, through transport M/s Ghatge Patil Transport Ltd. The payments in respect of consignment of Zarda received on the bills of M/s PTPL, Noida, were made mostly through cheque and draft. The payments in respect of cnsignment of Zarda received on the bills of M/s Vishwakarma Trading Co. were made in cash to Shri Neeraj Kumar or to Shri Pankaj Kumar Arya of M/s PTPL; that he also confirmed that they always purchased Aradhana Brand Zarda ....
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....onally it was made in cash also. The payments in respect of consignment of Zarda received on the bills of M/s Vishwakaiina Trading Co. and M/s Rishabh Trading company were made in cash only to Shri Neeraj Kumar or to Shri Pankaj Kumar Arya of M/s PTPL; that he also confirmed that they always purchased Aradhana Brand Zarda manufactured by M/s PTPL, Noida in Tin containers of 50 gms both on bills and without bills. After being shown way bills/bilties No. 7174907, 7174908, 7174909. 7174910 dated 12.02.2013, 7174926 dated 16.03.2013 and 7174930, 7174931 dated 23.03.2013, as submitted by M/s Ghatge Patil Transport Ltd., reflecting details of Zarda consignments transported by them on the bills of M/s Vishwakarma Trading Co. Noida, and 7174686 dated 21.12.2012 (of M/s Rishabh Trading Company) and statements of Shri Neeraj Kumar dated 23.04.2013, he confirmed the consignments related to them and agreed with the statements of Shri Neeraj Kumar. (xv) Shri Shrinivas Hegde, Propreitor of M/s Vishal Enterprises submitted that his firm used to purchase Aradhna Brand Zarda manufactured by M/s PTPL, Noida, both on bills and without bills. The unaccounted consignments of Aradhna Brand Zard....
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....Rishabh Trading Co., and statements of Shri Neeraj Kumar dated 23.04.2013, he confirmed the consignments related to them and agreed with the statements of Shri Neeraj Kumar. (xvii) I find that Shri Pankaj Arya s/o Shri Pradeep Kumar Arya, Director M/s PTPL, in his statement dated 19.12.2014, confirmed that the finished goods of M/s PTPL, Noida were booked with M/s Ghatge Patil Transport Limited, Delhi, through Shri Yogendra Kumar Sharma and his son Shri Deepak Sharma of M/s Om Transport Co. Noida. The finished goods of M/s PTPL, Noida were mainly booked on the bills of either M/s PTPL, Noida or M/s Vishwakarma Trading Company, Bhardwaj Market, Near Water Tank, Barola, Noida-ll, M/s Rishabh Trading Company Noida, M/s Pooja Traders, Noida and M/s Aamir Enterprises Noida; that the GRs / Way bills submitted by M/s Ghatge Patil Transport Limited., Delhi pertains to the consignments of Tobacco / Zarda booked on the bills of M/s Vishwakarma Trading Co. Noida, M/s Rishabh Trading Co. Noida, M/s Pooja Traders, Noida and M/s Aamir Enterprises, Noida which were cleared clandestinely from the factory of M/s PTPL, A-90, Sector-63, Noida; that GRs May bills submitted by M/s Ghatge Patil....
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.... different consignees whose confirmation of receipt do not appear reflected in the Annexure-B, therefore, the demand of duty calculated in the Notice does not appear to be correct. As regards interest and penalty it is submitted that when demand is doubtful the imposition of penalty and demand of interest does not appear justified. The party has submitted that major part of the demand made in the Notice are based on transport documents recovered from the transporter M/s Ghatke Patil Transport Ltd and from other premises and there is no evidence to show the manufactured of goods alleged to be removed clandestinely without payment of duty. It is a settled law that liability arises when there is manufacture. It has been submitted that there is no evidence to establish that there was some manufacture in the factory of the notice, there is no evidence of receipt of excess rawmaterials or other inputs including packing materials use for the manufacture of the goods which were cieared without payment of duty and in the-absence of manufacture of goods, demand of duty not justified. The party has submitted that document recovered from third party not admissible in reliable evidence without ....
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....taining to GRs / way bills dated 03.05.2013 and 21.11.2013 produced by M/s Ghatge Patil Transport Ltd. to the department, through which the goods i.e. tobacco and zarda were supplied by M/s Vishwakarma Trading Company, Noida, M/s Rishabh Trading Company Noida, M/s Pooja Traders Noida and M/s Aamir Enterprises, Noida, were loaded from M/s PTPL, and the bills in the name of above consignors have been handed over to them by M/s PTPL. Shri Naveen Kumar Kaul, Supervisor, M/s Ghatge Patil Transport Limited, confirmed that all the consignments of Tobacco / Zarda booked on the bills of M/s Vishwakarma Trading Company, Noida, M/s Rishabh Trading Company Noida, M/s Pooja Traders, Noida and M/s Aamir Enterprises, Noida were loaded from the factory of M/s PTPL, A-90, Sector-63, Noida. find that the purchasers of above goods viz Shri B. S. Kothawale. Proprietor of M/s Sri Siddheshwar Traders, Shri M.D. Kasar, Proprietor of M/s Shree Sai Agencies, Shri Manoj Kumar Patil, Proprietor of M/s Siddaram Traders, Shri Shrinivas Hegde, Proprietor of M/s Vishal Enterprises, Shri N.G. Mohan, Proprietor of M/s Shri Ram Stores confirmed that they have received consignments of unaccounted consignments of Ara....
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....t Ltd and from other premises and there is no evidence to show the manufactured of goods alleged to be removed clandestinely without payment of duty is not correct as the transporter and authorized signatory has confirmed that the goods were manufactured, loaded and cleared from PTPL duly confirmed by the driver. As for the contention that there is no evidence of receipt of excess raw-materials or other inputs including packing materials use for the manufacture of the goods, 1I find that shortage of raw material was detected at PTPL in the search by the departmental officers as discussed above. I find that party's contention that documents recovered from third party not admissible in reliable evidence without proper corroboration as to extra raw material procured or financial transaction is not tenable for the reason that clandestine removal of excisable goods have been admitted by their director and authorized signatory and corroborated by the buyers and the transporter. The onus in respect of above has been discharged by the department. (d) I find that the cases cited by the party is distinguishable from the instant case for the reason that the cases cited by the party relate....
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....Delhi were cleared clandestinely on the bills of M/s Vishwakarma Trading Co. Noida, M/s Rishabh Trading Co. Noida, M/s Pooja Traders, Noida and M/s Aamir Enterprises Noida from the factory of M/s PTPL, A-90, Sector-63, Noida, without payment of duty during the period January, 2012 to April 2013. I find that the duty liability amounting to Rs. 1,50,02,965/- for the period December, 2012 to April 2013 related to above goods cleared clandestinely is recoverable from PTPL under section 11A(4) of the Central Excise Act, 1944, along with interest at applicable rates under Section 11AA of the Central Excise Act, 1944. 5. (i) Above facts clearly brought out that PTPL were indulging in suppression of production and clandestine removal of finished goods in a well planned and systematic manner with intent to evade payment of Central Excise duty From the scrutiny of the seized records, confessional statements of various persons including the Directors and employees of the company, their transporters and buyers, it is clear that PTPL adopted a well planned modus operandi for evasion of Central Excise duty. The excisable goods manufactured in the factory of PTPL were clandestinely remov....
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....Trading Company. Shri Deepak Sharma submitted that the documents related to the consignments at the time of clearance were given by Shri Neeraj Kumar to him which were further handed over to the driver of the vehicle and further during the course of transportation such documents were taken back from the driver by Shri Deepak Kumar and again supplied to Shri Neeraj Kumar. The payments in respect of consignment of Zarda, cleared on the bills of M/s Vishwakarma Trading Company were in cash by Shri Neeraj Kumar. In his statement dated 23.04.2013, Shri Neeraj Kumar also confirmed hat the above-said 63 cartons of flavoured chewing tobacco which were seized by the officers along with he Vehicle/Truck Swaraj Mazda Registration No. UP- 16E/4970 on 17.04.13, were loaded and cleared from M/s PTPL without issue of excise invoice; that, M/s Vishwakarma Trading Co. was a non-existent firm, the bills of which were used by Ms PTPL to transport clandestinely cleared consignments of Zarda; that, the two consignments o Aradhna Brand flavoured chewing tobacco of 20 cartons each (Total 40 cartons) seized on 18.04.2013 from the premises of M/s Ghatge Patil Transport, C-9, SMA Industrial Area, Jhangirpur....
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....g my duty liability, I have voluntarily deposited Rs. 43 Lacs till date." (iii) From the above facts, itis crystal clear that PTPL deliberately violated the provisions of Central Excise Laws and defrauded the exchequer by not paying the Central Excise duty on the finished goods so cleared by them clandestinely as they were not maintaining proper account of finished goods. They did not maintain any account of their packing material. The raw material input goods were found short. Unaccounted details of clearance of excisable goods were also resumed from other residential premises of the Director of the party. Shortage and excess detected in the finished goods, raw materials and packing materials during stock taking of PTPL also confirm that PTPL was engaged in the unaccounted manufacture and clandestine clearance of Chewing Tobacco from their factory. I find that the party has violated the provisions of Rule 4,6,8,11 & 12 of the Central Excise Rules, 2002. In view of above, I find that PTPL is liable for penalty in terms of Rule 25 of the Central Excise Rules, 2002 read with Section 11AC of the Central Excise Act, 1944 6. I find that copies of 6 (six) GRs bearing se....
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....ng after the work of purchase production, sale administration and taxation pertaining to M/s PTPL. He was actively involved in suppression of production and clandestine removal of goods manufactured by PTPL. In his conclusive statement recorded under section 14 of the Central Excise Act, 1944 on 19.12.2014, he admitted that PTPL had cleared finished goods without payment of duty and he was involved with booking of consignments with M/s Ghatge Patil Transport Company through Shri Yogendra Sharma and his son Shri Deepak Sharma of Om Transport Co. Noida. Further, the purchaser of goods clandestinely removed, have confirmed that they have made payment of above goods to Shri Pankaj Kumar Arya in cash. I find that Shri Pankaj Kumar Arya in his reply has submitted that the allegation of suppression of production and clandestine removal without payment of duty has not been specified in the Notice, what was the quantity of production and how much raw materials were procured for manufacture of suppressed quantity and to whom the goods were sold, is not detailed in the S.C Notice, what role he played in evasion duty is not clear from the Notice. 1I find that reply of Shri Pankaj Kumar Arya is....
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....ply, submitted that he was the authorized signatory of the company and a sincere employee doing work allotted to him, his duties were as required by the employer, he has no independent role in the working of the company, therefore, the allegation that he knowingly involved himself in suppression and clandestine removal of the goods, is not correct. 1 find that Shri Neeraj Kumar was the authorized signatory of the company looking after the clearance of excisable goods and therefore, was aware about the central excise law; still he chooses to involved himself in clandestine clearance of excisable goods. Above facts clearly establish the lead role played by Shri Neeraj Kumar along with his employer Shri Pankaj Kumar Arya in clandestine clearance of excisable goods and evasion of central excise duty. In view all these facts, I hold that Shri Neeraj Kumar is liable for penalty under rule 26 of C.E. Rules, 2002 9. I find that Shri Umesh Yadav has stated that Shri Deepak Sharma, owner of the Vehicle/Truck gave him Bills and Way Bil/Bilty in respect of 63 cartons of flavoured chewing tobacco; that each time Shri Deepak Sharma, Owner of the Vehicle/Truck hands him over the Bills bo....
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....r knowledge as proper covering documents of the consignment were supplied by M/s P.T.P.L. all goods booked were delivered to the principal transporter M/s Ghatke Patil Transport Ltd. Shri Deepak Kumar does not appear for personnel hearing l find that the contention raised by Shri Deepak Kumar about their ignorance of the clandestine nature of goods and lack of evidence on record is not sustainable for the reason that he has admittedly involved in taking back the bills of M/s PTPL in transit from the driver of the vehicle for returning the same to Shri Neeraj Kumar and the goods were further transported on the bills of M/s Vishwakarma Trading Company, Noida, M/s Rishabh Trading Company Noida, M/s Pooja Traders, Noida and M's Aamir Enterprises, Noida as discussed above. I find that Shri Deepak Sharma was actively involved in the clandestine removal of excisable goods as he was involved in transporting excisable goods from the factory to the premises of Ms Ghatge Patil Transport Ltd. In view of above, I hold that Shri Deepak Sharma is liable for penalty under rule 26 of C.E. Rules, 2002 10. I find that Shri Kanwar Singh Yadav, Branch Manager of M/s Ghatge Patil Transport,....
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....PL or of M/s Vishwakarma Trading Company, Noida, M/s Rishabh Trading Company, Noida, M/s Pooja Traders, Noida and M/s Amir Enterprises, Noida. I find that M/s Ghatke Patil in their reply submit that no concrete evidence is adduced by the department to prove that they were fully aware of the non-duty paid nature of the tobacco/zarda which were handed over to them for transportation. It has been submitted by them that from none of the statements/documents recorded/relied upon in the show cause cum demand notice anywhere it is coming out that they were knowingly involved in the transaction and had clear idea that, the tobacco/zarda which they have transported/kept in our premises for further transportation were non-duty paid and hence were liable to be confiscated. No statement of any of their representative is recorded to find out whether they were involved in the transaction knowingly Further, in the statements recorded of various other parties also nowhere there is indication about their guilty knowledge. In such circumstances merely because they have transported the tobacco/zarda, one cannot conclude that they fully knew the non-duty paid nature of the said tobacco/zarda and still....
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....g Co. were made in cash to Shri Neeraj Kumar or to Shri Pankaj Kumar Arya of M/s PTPL. He confirmed the receipt of Zarda consignments on way bills / bilties No. 2416297 dated 23.03.2013 and bills / bilties No.2416227 dated 18.02.2013 as submitted by M/s Ghatge Patil Transport Ltd., on the bills of M/s Vishwakarma Trading Co., Noida. I find that Shri B.S. Kothawale was aware that the goods related to above way bills, bilties were cleared clandestinely by PTPL, that's why he made payment for the same in cash. I find that Shri B. S. Kothawale neither submitted any reply to notice nor avail the opportunity of personnel hearing. In view of above, 1 find that Shri B. S. Kothawale had knowingly involved in he transaction of excisable goods cleared clandestinely by M/s PTPL and is therefore, liable for penalty under rule 26 of C.E. Rules, 2002. 13. I find that Shri M.D. Kasar, Proprietor of M/s Shree Sai Agencies admitted that his firm used to purchase Aradhna Brand Zarda manufactured by M/s PTPL, Noida, without bills. The unaccounted consignments of Aradhna Brand Zarda were delivered to them at Madhavnagar on the bills of M/s Vishwakarma Trading Company, through transport M/s....
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....view of above, I find that Shri Manoj Kumar Patil had knowingly involved in the transaction of excisable goods cleared clandestinely by M/s PTPL and is therefore, liable for penalty under rule 26 of C.E. Rules, 2002 15. I find that Shri Shrinivas Hegde, Proprietor of M/s Vishal Enterprises admitted that his firm used to purchase Aradhna Brand Zarda manufactured by M/s PTPL, Noida, without bills. The unaccounted consignments of Aradhna Brand Zarda were delivered to them at Hubli on the bills of M/s Vishwakarma Trading Company, through transport M/s Ghatge Patil Transport Ltd. The payments in respect of consignment of Zarda received on the bills of M/s Vishwakarma Trading Co. were made in cash only to Shri Neeraj Kumar or to Shri Pankaj Kumar Arya of M/s PTPL. After being shown way bills/ bilties No 7174916 dated 07.03.2013 and bills/ bilties No.7174682 dated 12.12.2012 7174683 dated 13.12.2012, 7174684 dated 15.12.2012 as submitted by M/s Ghatge Patil Transport Ltd., reflecting details of Zarda consignments transported by them on the bills of M/s Vishwakarma Trading Co. Noida, he confirmed the consignments related to them. 1 find that Sh. Shriniwas Hengde has submitted that....
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....ds delivered on the bills of trading firms were of clandestine nature. The purchase of the goods was in the normal course of trade l find that the party did not avail the opportunity of personnel hearing l find that Shri N.G. Mohan was aware that the goods related to above way bills bilties were cleared clandestinely by PTPL that's why he made payment for the same in cash. In view of above, I find that Shri N.G. Mohan had knowingly involved in the transaction of excisable goods cleared clandestinely by Ms PTPL and is therefore, liable for penalty under rule 26 of of C.E. Rules 2002." 4.3 From the facts as narrated above it is evident Appellant 1 has through well devised mechanism by way of issuance documents in name of non existent firms namely,- M/s Vishwakarma Trading Company, Noida, M/s Rishabh Trading Company Noida, M/s Pooja Traders, Noida and M's Aamir Enterprises, was clandestinely clearing their finished goods to their customers located across the country in Maharastra, Karnataka etc. Against the goods cleared against invoices made in name of the fictitious companies they were receiving the payment in cash. Where they were clearing the goods on the invoices issue....
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....4 and from the transporter godown goods were transported on the documents issued in the name of fake company along with the transport documents prepared by the transporter M/s Ghatge Patil Transport Company. 4.7 As a follow up of the interception of truck on 17.04.2013, factory premises of the Appellant were searched on 17.04.2013 and the premises of transporter on 18.04.2013. During search of the factory premises of Appellant 1, discrepancies were again noticed in the stocks of finished goods and raw materials, these discrepancies were accepted by the Appellant 1. It was also accepted that Appellant 1 did not issued any invoice in its name on 17.04.2013 to transport the goods loaded on intercepted truck. 4.8 During the search of the premises of transporter Ghatge Patil Transport Company two clandestinely cleared consignments by the Appellant were found and were also seized. 4.9 The seized goods and truck were subsequently released provisionally after execution of B-11 bonds and cash security in form of Fixed Deposits. 4.10 Appellant 6 in his statement dated 23.04.2013 stated that • he is the owner of two trucks Registration Nos. UP 16E4970 and UP 13T-2127;....
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....ing Company, Noida, M/s Rishabh Trading Company Noida, M/s Pooja Traders, Noida and M/s Aamir Enterprises, Noida 4.13 Shri Naveen Kumar Kaul s/o Late Shri G. N. Kaul, aged 46 years Supervisor, M/s Ghatge Patil Transport Limited, in his statement under dated 25.04.2014, stated that • finished goods of M/s Pankaj Tobacco Pvt. Ltd., Noida, were booked by our agent Appellant 6 and his son Appellant 4; • the finished goods of Appellant 1 were mainly booked on the bills of either Appellant 1, M/s Vishwakarma Trading Company, Noida, M/s Rishabh Trading Company Noida, M/s Pooja Traders, Noida and M/s Aamir Enterprises, Noida; • all the consignments of Tobacco / Zarda booked on the bills of M/s Vishwakarma Trading Company, Noida, M/s Rishabh Trading Company Noida, M/s Pooja Traders, Noida and M/s Aamir Enterprises, Noida were loaded from the factory of Appellant 1; • all these bookings were on "TO PAY" basis and payments were received by them at the destination from the consignee 4.14 After identifying the customers to whom the goods of appellant 1 have been transported by M/s Ghatge Patil Transport Company, statements of the custome....
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....who used to purchase Aradhan Brand Zarda manufactured by M/s PTPL, Noida both on the bill and without bills. • The unaccounted consignments of Aradhan Brand Zarda were delivered to them on the bills of M/s Vishwakarma Trading Company, Bharadwaj Market, Near Water Tank, Barola Noida-lI, through transport M/s Ghatge Patil Transport Ltd., C-9, SMA Industrial Area, Jehangirpuri, Delhi -33. • The payments in respect of consignment of Zarda received on the bills of Appellant 1, were received through cheques only. • The payments in respect of consignment of Zarda received on the bills of M/s Vishwakaiina Trading Co. were received in cash; • he has seen the quantification chart and admitted with the duty liability amounting to Rs. 1,50,02,965/- for the period December, 2012 to April 2013; • admitting the duty liability he had deposited Rs. 43 Lakhs till 19.12.2014 4.16 Thus it is evident that the all the threads necessary to establish the case of clandestine clearance have been investigated and interwoven to unearth the scheme of clandestine clearance adopted by the Appellant 1, Appellant 2, Appellant 3, Appellant 4, Appel....
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....ned party does not even dispute that they have no independent use there is no need for the Department to prove the same. It is a basic and settled law that what is admitted need not be proved." 4.18 In the impugned order reliance has been placed on the decision of Hon'ble Supreme Court in the case of D Bhoormull [1983 (13) ELT 1546 (SC)] and it has been observed that the investigation has established the case of clandestine clearance against Appellant 1 within the preponderance of probability as per the test laid down by the Apex Court. The decision in the case of Super Smelters Ltd. [2020 (371) E.L.T. 751 (Tri. - Kolkata)] as the facts of that case are clearly distinguishable. In that case it was held that case could not have been based on the certain loose slips recovered in absence of any corroborative evidences. In present all the evidences establishing till the receipt of clandestinely cleared goods by the customers and payments thereof has been recorded. Further all the documents including the calculation chart of the duty evaded was admitted by the Appellants. 4.19 Appellant had asked for the cross examination of the transporter. We find that no statement of the transp....
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....ch documents can be presumed unless the contrary is proved. This Section applies to Department proceedings as well. (11) One of the partner in his statement given before the Central Excise Officers admits that the goods have been removed clandestinely. This statement has not been retracted. The interpretation sought to be given to the word „Sauda‟ is not acceptable one. It is only an afterthought version. He is not specific in saying that no goods have been delivered. Further, if it was only a Sauda, why was the broker asking for his commission? All commissions are paid only after the transaction is over. The broker sends the bills for his commission only after the deal is fructified. The broker clearly states that he sent the bills for his commission. (12) The fact that there are discrepancies in the ledger of the broker does not lead to inference that the goods have not been removed from the appellant's premises. The appellant wants to prove his innocence on the basis of some factual errors in the ledger of the broker. It is clearly unacceptable. (13) The Revenue is right in holding that in a case of clandestine removal, it is not necessary ....
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....g of the demand of duty, as they had based their calculations only in respect of 50 paise per pouch that is in a most reasonable and minimum level. The learned SDR referred to the provisions under Section 36A of the Central Excise Act, 1944 raising presumption as to documents in certain cases and submitted that similar presumption should be applied even to the proceedings under this Act. He relied upon the following decisions :- (i) Collector of Central Excise, Ahmedabad v. Vidya Wires (P) Ltd. [2002 (149) E.L.T. 1448 (Tri.-Del )]: Once Managing Director of the assessee firm admitted that 18 boxes of super enameled copper wire had been removed without payment of duty and some of the goods with the labels of the assessee's firm had been found in the premises of customer, preponderance of probability in regard to clandestine removal was in favour of department. (ii) A.K. Engg. Co. v. Commissioner of Central Excise, Calcutta-I [2002 (141) E.L.T. 449]: The charge of clandestine removal is sustainable, when on interception of vehicle transporting goods without payment of duty, totality of evidence by way of statements both of proprietor and manager admitting to manufac....
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....ner because it is settled position in law that the admitted fact need not be proved. Finding no infirmity in the impugned order, we are inclined to go by the reasoning and findings as contained in the impugned order. At this stage of dictation of the present order, the learned counsel interprets and pleads for leniency in the penalty imposed by the authority below as he had invoked the provisions of Section 11AC and imposed a heavy penalty which is equivalent to the duty demanded. We, however, on considering the facts and circumstances of the matter find that there is no warrant for interfering with the impugned order in any way as the penalty imposed is commensurate to the nature of offence. Both the appeals are, therefore, dismissed." 4.22 Affirming this decision as reported at [2008 (228) ELT 171 (Del)], Hon'ble Delhi High Court observed as follows: "4. It appears that a tempo carrying pan masala/gutka was intercepted by the Anti Evasion Branch of Central Excise, New Delhi on 19th February, 2002. The goods were found to have been clandestinely removed by the Assessee. As a result of follow up investigation, the Revenue found certain loose sheets which, according to t....