TaxTMI 
TaxTMI 
2026 (7) TMI 367
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....ants Shri Sharad Haribhai Naik, and Shri Vinod Kumar Mittal, were working as Authorised Signatory and Liaisoning Officer (Personnel and Administration) and Director of M/s. Rathi Rerollers (India) Limited. M/s. Rathi Rerollers (India) Limited (hereinafter referred to as M/s. Rathi for short) was engaged in manufacturing of M S Bars falling under Chapter Heading 72 of the First Schedule of Central Excise Tariff Act, 1985. M/s. Rathi was having Central Excise registration for manufacturing of aforesaid products and availing Cenvat Credit facility under Cenvat Credit Rules, 2004. 2.1 Based on intelligence that M/s. Rathi was indulged in large scale evasion of Central Excise duty by way of clandestine clearance of their finished goods i.e. M.S. Bars, searches were conducted at factory premises of M/s. Rathi Rerollers (India) Limited at Silvassa, New Delhi and Vapi, investigation was carried out and Panchnamas were drawn. After investigation, it appeared that M/s. Rathi had manufactured and cleared 5306.408MT of MS Bars and scraps without preparation of Central Excise invoices and without payment of Central Excise duty from the factory premises. It also appeared that M/s. Rathi had c....
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....Naik, Authorised Signatory cum Liaisoning Officer (Personnel & Administration) of the unit has stated in his statements that he was working as per directions of Shri Vinod Kumar Mittal, Director of the unit. He was also proprietor of the trading firms of the unit viz. M/s. Sai Steel Suppliers, Silvassa and Maa Durga Steel Company, Vapi. He has accepted that the raw materials were not entered in the Central Excise records with an intention to use them for the production of finished goods and clearance thereof without preparation of Central Excise invoices and without payment of duty. He also accepted that all things were in his knowledge. He played a vital role in clandestine manufacture and clearance of finished goods as he was Authorised Signatory of the unit and he looked after all the works related to the unit. He had knowingly concerned himself in dealing with the excisable goods in a manner which is not permitted under Central Excise law. He is therefore liable for penalty under Rule 26 of Central Excise Rules, 2002. 3. On the basis of above observations and conclusion, learned Commissioner imposed penalty of Rs. One lakh on Shri Sharad Haribhai Naik, Authorised Signatory c....
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....impugned order imposing penalties upon the appellants is sustainable or not and whether the impugned order has been passed in accordance with law. 6.1 The learned Commissioner has imposed penalty of Rs. 50Lakhs on the appellant Shri Vinod Kumar Mittal, Director of M/s. Rathi and penalty of Rs. One lakh on the appellant Shri Sharad Haribhai Naik, Authorised Signatory and Liaisoning Officer (Personnel and Administration) of M/s. Rathi under Rule 26 of the Central Excise Rules, 2002. For ease of reference, the provisions of Rule 26 of the Central Excise Rules, 2002 are reproduced below:- 26. Penalty for certain offences. [(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 greater. [Provided that where any proceedings for the person liable to pay duty have been concluded under clause (a) or clause (d) o....
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....f giving evidence, or is kept out of the way by the adverse party, or whose presence cannot be obtained without an amount of delay or expense which, under the circumstances of the case, the Court considers unreasonable; or (b) when the person who made the statement is examined as a witness in the case before the Court and the Court is of opinion that, having regard to the circumstances of the case, the statement should be admitted in evidence in the interests of justice. (2) The provisions of sub-section (1) shall, so far as may be, apply in relation to any proceeding under this Act, other than a proceeding before a Court, as they apply in relation to a proceeding before a Court.] 6.4 Hon'ble Gujarat High Court, in the case of Commissioner, CGST and Central Excise, Vadodara-1 vs. Pareshbhai Ramabhai Amin (2026) 39 Centax 379 (Guj.), has held as follows:- "4. We are in complete agreement with the findings recorded by the Tribunal, as there was no tangible evidence or any corroborative evidence against the respondent to connect him with the manufacture of gutkha. No independent corroborative evidence has been produced and in wake of the fact that the....
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....t. He was also proprietor of the trading firms of the unit M/s. Sai Steel Suppliers and M/s. Maa Durga Steel Company, Vapi. He has accepted that the raw materials were not entered in the Central Excise records with an intention to use them for production of finished goods and clearance thereof without preparation of Central Excise invoices and without payment of duty. He also accepted that all things were in his knowledge. He played a vital role in clandestine manufacture and clearance of finished goods as he was authorised signatory of the unit and looking after all the works related to the unit. He had knowingly concerned himself in dealing with the excisable goods in a manner which is not permitted under Central Excise law. However, except for this confessional statement, no corroborative evidence has been discussed by the learned Commissioner in his impugned order. Therefore, I am of the view that the conclusion arrived at by the learned Commissioner for imposing penalty on the appellants Shri Vinod Kumar Mittal, Director and Shri Sharad Haribhai Naik, Authorised Signatory and Liaisoning Officer (Personnel and Administration) of M/s. Rathi cannot be upheld as they are without s....