2025 (9) TMI 931

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....ting the following substantial questions of law :- "(i) Whether the CESTAT is correct in holding that no corroborative evidence is available in this case, without going into the merits as discussed in O-in-O no. RPR/EXCUS/000/COM/04/2017 dated 10.02.2017 ? (ii) Whether the CESTAT was legally justified in disposing off the appeal before it referring to the case of Continental Cement Company Vs. Union of India 2014 reported at 2014(309) ELT 411 (All.), without appreciating the distinguishing factors of the case before it making its facts distinct from the facts of the precedents relied ?" 3. The aforesaid substantial questions of law have arisen for consideration in this appeal on the basis of following factual backdrop :- (i) On 02/12/2008, the office-cum-factory premises of M/s Devi Iron and Power Pvt. Ltd. as well as the residential premises of Mohammed Nazirooddin Sheikh, proprietor of M/s KGN Consultants, Raipur, were searched and several incriminating documents/records related to alleged clandestine production and clearance of sponge iron were seized and panchnama was prepared. The factory premises of the respondent Firm was again searched and some....

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....ld not be confiscated under Rule 25 of Central Excise Rules, 2002. As the said goods are not available for confiscation, as to why fine in lieu of confiscation should not be imposed on them, under Section 34 of Central Excise Act, 1944. (e) Penalty should not be imposed upon them, under Section 11AC of the Central Excise Act, 1944. (f) Penalty should not be imposed upon them under Rule 25 of the Central Excise Rules, 2002" (iv) The said show cause notice was adjudicated by the learned Adjudicating Authority vide OIO No. Commissioner/RPR/CEX/128/2012 dated 31/12/2012 (Annexure A/4), however, being aggrieved by the said order, the parties filed appeal before the Tribunal and vide Final Order No. 58279-58285/2013 dated 12/11/2013, the Tribunal remanded the matter to the Adjudicating Authority and thereafter, the Commissioner passed the adjudication order No. RPR/EXCUS/000/COM/04/2017 dated 10/02/2017 (Annexure A/3) whereby he confirmed the demand amounting to Rs. 5,89,93,480/- against the respondent Firm and ordered its recovery along with interest under Sections 11A and 11AB of the Act of 1944 and further imposed equal penalty under Section 11AC of the Act ....

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....n Sheikh, Proprietor of M/s KGN Consultants, Raipur and thereafter, show cause notice dated 14/12/2010 (Annexure A/2) was issued to the respondent Firm for clandestine removal of finished goods, which was adjudicated by the Adjudicating Authority and after considering the statements of the witnesses and after considering 58 documents, the Order in Original dated 10/02/2017 (Annexure A/3) was passed in detail in second round of litigation whereby he confirmed the demand amounting to Rs. 5,89,93,480/- against the respondent Firm and ordered for its recovery with interest and also imposed equal penalty, which was then put to challenge by the respondent Firm before the Tribunal by filing the appeal and by impugned order dated 20/04/2018 (Annexure A/1), the Tribunal allowed the appeal and set aside the order of the Adjudicating Authority by briefly recording its findings in paragraphs 7 and 8, which state as under :- "7. In the instant case, the sole basis for demanding the duty is the diary and loose paper sheets from Shri Mohammed Nazirooddin Sheikh but the fact remains that he was working for the appellant for supervising the production as well as supplying the labour. Shri ....

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.... (iii) Whether interest at the appropriate rate on the above Central Excise duty determined to be payable under the provisions of Section 11A of the Central Excise Act, 1944 is recoverable under Section 11AB of the Central Excise Act, 1944 ? (iv) If 32477.705 MTs Sponge Iron is held to be cleared by M/s Devi Iron without issue of invoices and without payment of central excise duty, whether it can be confiscated under Rule 25 of Central Excise Rules, 2002 and whether fine in lieu of confiscation should be imposed on it, under Section 34 of Central Excise Act, 1944 as the said goods are not available for confiscation ? (v) Whether penalty can be imposed upon the Noticee No. 1 under Section 11AC of the Central Excise Act, 1944 and Rule 25 of the Central Excise Rules, 2002 ? (vi) Whether penalty can be imposed upon Shri Ramanand Agrawal and Shri Arun Gupta, Directors of M/s Devi Iron, Shri V.P. Goswami and Md. Nazirooddin Sheikh under Rule 26 of the Central Excise Rules, 2002 ?" 10. After recording the aforesaid issues for consideration, the Adjudicating Authority has considered the issues and decided them collectively and has passed a detailed and reason....