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2019 (11) TMI 193 - AT - CustomsImposition of penalty u/s 112 and 114A of CA - Clandestine removal - illegal diversion of duty free imported and indigenous raw materials i.e Transfer Print paper, Grey Fabrics and Knitted Fabrics etc. as such which was procured by them subject to condition of use of same in manufacture and export of finished goods - cross-examination of witnesses - HELD THAT:- Pursuant to investigation undertaken by the revenue, it was found that the Appellant Unit had been showing the receipt of raw material i.e. transfer print paper, fabric etc in their factory and its use in manufacture of export goods which was shown to have been cleared to M/s Sunshine and Al-Amin Exports. The investigation at M/s Al-Amin and Sunshine showed that infact they did not receive any goods from the Appellant Unit but received a premium of ₹ 4 to 5 from Shri Mahendra Sancheti, director of Appellant Unit in whose favour the CT-3 certificates were issued. Shri Rashid Sayyed, the partner of M/s Al-Amin in his statement stated that one Shri Bilal Latif Memon used to supply readymade cheap goods after purchasing from open market to M/s Sunshine and M/s Al- Amin through the tempos of Shri Akbar Tempowala. No goods were received from M/s Laurel. The EOUs used to do minor jobs of sewing and packing and export the goods. It was found that all the goods were brought by these firms from market. No physical evidence of transportation of finished goods could be shown by M/s Laurel. This clearly shows that M/s Laurel instead of use of duty free raw material in manufacture of finished goods to be exported, has sold the raw material in open market. The Appellant has challenged the impugned order also on ground that no cross examination of panch witnesses and other witnesses was provided. We find that the repeated statements of the concerned persons clearly shows that the raw material was cleared by the Unit in open market and false receipt of goods was shown by the consignee unit. Even the goods seized from consignee M/s Al-Amin could not have been manufactured from goods supplied by M/s Laurel as the same were different in GSM and Denier. It leaves no doubt that M/s Laurel did not use the duty free raw material in manufacture of export goods and instead cleared the same in open market. The impugned order deserves no interference and the appeals filed by M/s Laurel and other co-appellants are required to be dismissed - As regard appeal filed by the revenue that the adjudicating authority has wrongly given option to pay reduced penalty under Section 114A, we consider it appropriate to send the matter back to the adjudicating authority to look into the contentions raise by the revenue and to decide the quantum of penalty - Appeal disposed of by way of remand.
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