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2018 (1) TMI 260 - AT - Central ExciseClandestine removal - Validity of second SCN - extended period of limitation - case of appellant is that the extended period of limitation is not invokable in subsequent proceedings when the earlier proceedings on same subject matter are decided/pending - 2 invoices on which purchase of raw material was allegedly made via the first stage dealer M/s.Shiv Shakti Steels - 24 invoices on which purchase of raw material was shown directly from M/s.HSAL. Held that: - Had the appellant informed the DGCEI about availment of credit in complete details and come fully clear on 27.8.2008 itself, the same would have become part of the first show cause notice itself. Since it was deliberate suppression and positive act of mis-declaration by the Director of the NSPL, which was discovered after his second statement dt.23.12.2009, I find that the Department had no option but to issue second show cause notice. However, a different picture emerges with respect to 2 invoices pertaining to M/s. Shiv Shakti Steels. I find that the transactions, which have been made by M/s.HSAL through the dealer M/s.Shivshakti Steels, were in the knowledge of the Department when first show cause notice was issued on 2.12.2008. This is evident from the fact that the statement of Ashok Bansal, partner in M/s. Shiv Shakti Steels was recorded on 19.11.2008 wherein he was questioned about these invoices. Hence, these two invoices could not be included in second show cause notice - demand in respect of 2 SCN set aside. The new facts relating to 24 invoices came to the notice of the Department only after second statement of Shri Dinesh Goyal - While some part of the investigation, in both proceedings are undoubtedly common, but the suppressed information relating to 24 transactions directly with M/s.HSAL between 18.2.2006 and 7.6.2006 were not included in his categorical statement given by Shri Goyal on 27.8.2008 and deliberately withheld. Hence I hold that the department is justified in invoking the extended period for the second show cause notice in respect of 24 invoices - the demand in respect of 24 invoices issued by M/s.HSAL is sustained. Penalty on M/s.NSP Forging Pvt.Ltd. - Held that: - since there was fraudulent availment of credit, suppression and mis-declaration, the penalty of equivalent amount to credit pertaining to 24 invoices referred hereinabove is thus sustained. Penalty on the Director under Rule 26(1) - Held that: - it is evident that Shri Goyal has played a vital role in receipt of only invoices from M/s.HSAL to give appearance that the transactions were genuine. Besides, he did not disclose full information as required of him under law in his earlier statement 27.8.2008 and the details of 24 invoices in the show cause notice dt.23.2.2010 came to light in his statement dt.23.12.2009 - penalty on the Director is justified - however, quantum of penalty is excessive considering the duty evaded and the same is therefore reduced to ₹ 6 lakh. Appeal disposed off.
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