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Central Excise - Case Laws
Showing 41 to 60 of 241 Records
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2015 (4) TMI 1030
Cenvat/Modvat Credit - Whether cenvat credit eligibility is to be determined with reference to dutiability of the final product on the date of receipt of the goods or the date of utilization of 50% credit - Held that:- CENVAT credit eligibility is to be determined with reference to the dutiability of the final product on the date of receipt of capital goods. - facts herein is squarely covered by the ruling of the Larger Bench of this Tribunal in the case of Spenta International Ltd. (2007 (8) TMI 25 - CESTAT, MUMBAI). Accordingly the impugned order is set aside - Decided in favour of Revenue.
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2015 (4) TMI 1029
Levy of interest on Reversal of cenvat credit - Held that:- Adjudicating authority has demanded credit interest of ₹ 50,827/- and imposed penalty of ₹ 10,000/- which was set aside by the Commissioner (Appeals) in the impugned order. On perusal of the order, I find that the LAA by relying on the Tribunal s decisions against TATA Motors Ltd. Vs CCE Jamshedpur [2004 (8) TMI 276 - CESTAT, KOLKATA] and Gokulam Spinners Vs CCE [2004 (9) TMI 648 - CESTAT CHENNAI] and other decisions had allowed the appeal and set aside the interest and penalty. In this regard, I find that the Tribunal s Principal Bench at Delhi on identical issue in the case of Gurhmehar Construction Vs CCE Raipur (2014 (7) TMI 849 - CESTAT NEW DELHI) had allowed the appeal by relying Hon ble High Court s decision in the case of Commissioner Vs Bill Forge Pvt. Ltd. - [2011 (4) TMI 969 - KARNATAKA HIGH COURT] and also distinguished the Supreme Court in the case of UOI Vs Indo-Swift laboratories Ltd. - [2011 (2) TMI 6 - Supreme Court]. - ratio of the Tribunal’s decision and the Hon ble High Court decisions are squarely applicable to the present case. Therefore, I hold that respondents are not liable for interest on the credit already reversed. Accordingly, the impugned order is upheld - Decided against Revenue.
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2015 (4) TMI 1028
Valuation of goods - Inclusion of overhead cost and profit margin - Held that:- Personal hearing was granted to the appellant on 28.12.2004 and the Commissioner has relied upon the reports of the AD (Cost), which are dated 23.2.2005 and 14.3.2005 and the order is passed on 31.3.2005. Under the circumstances, we find force in the contention of the counsel for the appellant that there has been serious breach of principles of natural justice inasmuch as the order has been passed without supplying the copy of the above mentioned reports. In view of the above position, we set aside the impugned order and allow the appeal by way of remand - Matter remanded back - Decided in favour of assessee.
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2015 (4) TMI 1027
Waiver of pre deposit - exemption under notification no. 214/86-CE - Held that:- Appellant manufacture rubber compound on job work basis for M/s Birla Tyres, Haridwar, out of the raw materials received by them and were availing the exemption under notification no. 214/86-CE. This exemption notification is available to the job worker on the basis of a declaration made by him that the goods manufactured by him and cleared to the principal manufacture would be used by the principal manufacturer in the manufacture of finished product which would be cleared on payment of duty. In this case, there is no dispute that the principal manufacturer M/s Birla Tyres were availing of full duty exemption under notification no. 50/03-CE and accordingly, the final product manufactured by them by using the rubber compound were being cleared at nil rate of duty. In view of this, were are of the prima facie view that the appellant would not be eligible for exemption notification no. 214/86 and as such do not have prima facie case in their favour. - Partial stay granted.
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2015 (4) TMI 1026
Valuation of the goods - Clearance of goods to another unit of same appellant - Determination of value u/r 8 - Held that:- Since the issue involved in this case stands decided in the respondents favour by Larger Bench judgment of the Tribunal in the case of Ispat Industries Ltd. (2007 (2) TMI 5 - CESTAT, MUMBAI) and in that judgment the other judgment of the Tribunal in the cases of BOC India Ltd. (2004 (4) TMI 125 - CESTAT, KOLKATA) and Steel Complex Ltd. (2003 (9) TMI 252 - CESTAT, BANGALORE) have also been considered, it is the Larger Bench judgment of the Tribunal which would be binding on this Bench. Hence, we do not find any infirmity in the impugned order. - Decided in favour of assessee.
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2015 (4) TMI 1025
Denial of CENVAT CREDIT - Credit merely on the strength of the duty-paying documents i.e. Bill of Entry without using the scrap as inputs in the manufacture of final products - Held that:- Appellant indeed submitted a letter dated 23/08/2010 wherein they have requested the adjudicating authority to provide relied upon documents as listed in Annexure III to the show cause notice. However, the adjudicating authority has not dealt this request and even not stated anything in the order whether the relied upon documents were supplied along with the show cause notice. It is also observed that the request of the appellant made by appellants letter dated 23/08/2010 for supply of relied upon documents was also recorded by the learned Commissioner (Appeals) in his order in para 14. However, no finding was given. In view of the above factual matrix, the appellants submission that they were not supplied the relied upon documents and, therefore, they could not made their defence submission effectively found to be reasonable. - Matter remanded back - Decided in favour of assessee.
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2015 (4) TMI 1024
Reversal of CENVAT Credit - Whether the appellant is required to reverse the credit in respect of the durable and returnable glass bottles and crates retained/ not returned by the buyer of the soft drinks - Held that:- On perusal of the issue before the learned Commissioner (Appeals) where the appellant is required to pay duty on the crates and glass bottles broken during the process of filing and packing of soft drinks or not whereas the learned Commissioner (Appeals) has decided the issue whether the respondent is required to reverse the credit in respect of durable and reuseable glass bottles and crates returned by the buyers of the soft drink. Learned Commissioner (Appeals) has erred in deciding the issue. Therefore, impugned order is set aside and I remand the matter to the adjudicating authority to decide the issue as prayed by the Revenue in their appeal. Accordingly, matter is remanded back - Decided in favour of assessee.
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2015 (4) TMI 1023
Denial of SSI Exemption - Imposition of penalty - Clubbing of clearances - SCN was not issued to all the parties - Held that:- Units of M/s. Jai Hardware Pvt. Ltd., M/s.Door Devices Manufacturing Company, M/s. Deepak Hinges Pvt. Ltd., M/s.Monika Steels Pvt. Ltd. M/s.D.D. Hardware Pvt. Ltd. and M/s. D.P. Garg Exports Ltd. are the existing firms/companies having factories at different locations. Therefore, if the clearances of these units are sought to be clubbed with the clearances of the appellant unit, it was necessary to issue the show cause notices to these firms so as to enable them to put up their defene and without hearing the units, whose clearances are sought to be clubbed with the clearances of the appellant company, a unilateral decision cannot be taken that all the units are owned and controlled by one person only. For clubbing the different units for the purpose of SSI exemption, the only requirement is that the units should be owned by one person and for this purpose, it is absolutely necessary that if the clearances of a unit A are sought be clubbed with the clearances of the units, B, C and D and these units are owned by different persons, show cause notices must be issued to B, C and D, whose clearances are sought to be clubbed with the clearances of Unit A. We are supported in this view by the judgement of Calcutta High Court in the case of Diamond Scaffolding Company reported in [2011 (7) TMI 854 - CALCUTTA HIGH COURT] and the judgements of the Tribunal in the cases of Copier Force India Ltd. reported in [2008 (7) TMI 163 - CESTAT, CHENNAI], K. R. Balachandra reported in [2002 (8) TMI 197 - CEGAT, CHENNAI], Poly Resins reported in [2003 (8) TMI 132 - CESTAT, CHENNAI]; CCE, Bombay Vs. Supreme Electrical Appliances reported in [2001 (3) TMI 369 - CEGAT, NEW DELHI] and SKN Gas Appliances reported in [2000 (5) TMI 95 - CEGAT, COURT NO. II, NEW DELHI]. - Decided in favour of assessee.
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2015 (4) TMI 1022
Waiver of pre deposit - valuation - captive consumption at different units - Duty on the basis of 110% of the cost of production in terms of Rule 8 of the Central Excise Valuation Rules - Held that:- The appellant in their Badli Unit manufacture sheet metal components for various car manufacturers including MUL, and the component are cleared by them to Manesar Unit and Greater Noida Unit of the same appellant company where the components are tested and packed and thereafter are cleared to car manufacturers on payment of duty. Prima facie, we find that even if the provisions of Rule 8 of the Central Excise valuation Rules are applicable and the appellant unit at Badli is required to pay the differential duty, the Manesar Unit and Greater Unit of the same appellant company would eligible for its cenvat credit and as such, it would be the Revenue neutral situation in respect of which the apex court judgment in the case of CCE Pune vs Coca Cola India (P) Ltd. reported in [2007 (4) TMI 17 - SUPREME COURT OF INDIA] would be applicable. The appellant, therefore, have prima facie case in their favour. - Stay granted.
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2015 (4) TMI 1021
Waiver of pre deposit - CENVAT Credit - Capital goods - whether the appellant would be eligible for cenvat credit in respect of MS angles, channels, bars etc., which had been taken by them during the period from September 2010 to February 2012 - Held that:- There is no evidence that the fabrication of the capital goods had been declared by them in the ER-1 returns or by any other specific information in this regard given by the appellant. The steel items, in question, - MS angles, channels, bars etc. are not covered by the definition of capital goods and the same would be eligible for cenvat credit only if there is evidence on record to prove that the same had been used for fabrication of capital goods and only in that case such steel items would be eligible for cenvat credit as inputs. But for this there must be some clear evidence on record which, prima facie, is not there in this case. - this is not a case for total waiver from the requirement of pre-deposit. After considering the overall facts and circumstances of the case and also the plea of financial hardship pleaded by the appellant, we direct the appellant to deposit an amount of ₹ 40 lakh within a period of 8 weeks. On deposit of this amount within the stipulated time period, the requirement of pre-deposit of balance amount of cenvat credit demand, interest and penalty would stand waived and recovery thereof is stayed - Partial stay granted.
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2015 (4) TMI 1020
Penalty u/s 11AC - whether penalty under Section 11AC has been rightly imposed on the appellant in the fact that due to change in the warehousing provisions w.e.f. 6.9.2004 vide Notification No. 17/04-CE, the appellants are having certain quantity of stock in the warehouse, which was declared to the department on 6.9.2004 itself - Held that:- Issue as to differential duty has been arisen in the facts of this case as a matter of interpretational issue. There is no concealment or contumacious conduct on part of the appellant found by the Revenue. Accordingly, the penalty under Section 11AC read with Rule 25 of the Central Excise Rules, 2002 is set aside. The appellant shall be liable to pay interest as held in the impugned order under Section 11AB and shall deposit the same, if not paid so far - Decided partly in favour of assessee.
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2015 (4) TMI 1019
Denial of Cenvat credit - credit on pet coke which was used for generation of electricity by the sister unit of the respondent which in turn sent the electricity to the respondent which was ultimately used in the manufacture of final product - whether the respondent is entitled to take Cenvat credit on pet coke which has been used in generation of electricity outside the factory and said electricity has been used by the respondent in manufacturing of their final product or not - Held that:- Admittedly electricity so generated has not been used in the manufacture of final product. Further in the said case the Hon’ble Apex Court analyzed how the Cenvat credit can be availed on inputs which have been sent to the job worker and ultimately used in the manufacture of final product - in the case of Haldia Petrochemicals Ltd. (2005 (1) TMI 306 - CESTAT, NEW DELHI), the identical issue was before this Tribunal wherein this Tribunal has held that naphtha, as such or after being partially processed, sent to power plant and raw material used by the power plant for generation of electricity; said electricity is sent to the principal manufacturer. On such inputs sent to the job worker, the assessee is entitled to take Cenvat credit. Similarly, in the case of pet coke which has been sent by the respondent to their sister unit for manufacturing of electricity which ultimately has been used by the respondent for manufacturing of their final product, i.e. cement. Therefore, the respondent has qualified for entitlement of Cenvat credit as per Rule 2 (k) of the CCR, 2004. Consequently, I do not find any infirmity in the impugned order, the same is upheld. - Decided in favour of assessee.
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2015 (4) TMI 998
Prosecution proceedings where demand of duty was set aside on the ground of period of limitation - non-petitioners were discharged mainly on the ground that separate proceedings for imposition of penalty were decided in favour of the non-petitioners - Held that:- Perusal of Section 11 of the Act of 1944 shows as to when and for what purpose, it can be invoked. It is for recovery of excise duty which is not paid for various reasons or could not be recovered. Section 11 of the Act of 1944, however imposes limitation for initiation of the proceedings. In the first category of cases, limitation to issue notice is only of 6 months, whereas in the second category, it is for 5 years. So far as Section 9 of the Act of 1944 is concerned, it operates for the offences and consequential penalties. No limitation for initiation of prosecution has been given therein. The facts aforesaid are relevant as proceedings in pursuance to Section 11 of the Act of 1944 were terminated as the notice was found beyond the period of limitation for recovery of excise duty. The Tribunal found case to be falling in first category having limitation of 6 months and not in second category having limitation of 5 years. The order was passed in favour of the assessee after recording finding on the issue of limitation, thus it becomes clear that determination of the issues by the Tribunal was not on merit but on limitation. It may be that arguments were made even on merit but no finding has been recorded, if the order of the Tribunal is perused.
Determination of issue by the Tribunal is not on merit but on a technical ground of limitation. The same is the position regarding reference whether determination of the issue was not made but reference was dismissed on account of default in appearance of the parties concerned. - In absence of determination of issues on merit, the non-petitioner cannot take shelter of judgment of Apex Court in the case of K.C. Builders (2004 (1) TMI 7 - SUPREME Court). In the instant case, Section 9 of the Act of 1944 does not provide any limitation to initiate the proceedings though there may be limitation for taking cognizance of offence under Cr.P.C. The issue aforesaid is not raised before me. When the Tribunal so as High Court has not touched the merit, there was no reason for the revisional court to discharge the non-petitioners by setting aside the order of learned Magistrate. The non-petitioners were definitely entitled to take the benefit of delay in issuance of notice for recovery of excise duty if It was beyond the period of limitation. So far as prosecution under Section 9 of the Act is concerned, it has not provided limitation. The revisional court failed to make distinction between two proceedings and the effect of the order passed by the Tribunal and the High Court where merit of the case was not touched. - Decided in favour of Revenue.
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2015 (4) TMI 997
Waiver of pre deposit - Jurisdiction of Tribunal - Whether the Hon'ble Tribunal has jurisdiction to put a condition of depositing ₹ 40 lakhs while remanding the issue back to the Commissioner of Central Excise for fresh adjudication - Held that:- Tribunal has dealt with the merits of the case at length, and held that there was no discussion or evidence available on record to show excess consumption of raw material and electricity, or any other material to show that the appellant removed the products clandestinely. It has also been recorded in the impugned order that in the audit which was conducted, no discrepancy was found in the records of the company. The Tribunal has also held that there was no indication to show that there was excess consumption of raw material, or there was misdeclaration of consumption by the appellant. After giving a detailed finding of fact that the Adjudicating Authority had not considered the various evidences which were led, and that no proper opportunity of cross-examination or hearing was afforded to the appellant, the Tribunal has set-aside the order passed by the Adjudicating Authority which had imposed liability of over ₹ 26.00 crores on the appellant.
It is clear that though for setting-aside the order passed by the Adjudicating Authority and remanding the case for fresh decision, sufficient reasons have been given, but no reason, whatsoever, has been given for imposing a precondition of deposit of ₹ 40.00 lakhs by the appellant. There is even no justification for quantifying the amount ₹ 40 lakhs to be deposited by the appellant. - Tribunal may, for some specific and valid reason, have the jurisdiction to impose the condition of deposit of certain amount while remanding the case back to the Adjudicating Authority, but the same can be done only in a judicious manner and not in arbitrary manner and without justification. In the present case, the same is totally lacking. - Decided in favour of assessee.
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2015 (4) TMI 996
CENVAT Credit - Bogus invoices - entire investigation was conducted under impression that it is not commercially viable for any manufacturer to manufacture copper scraps out of copper ingots/ wires/ bars - transporters had not availed to route through RTO check post - Held that:- Probative value of the document needs to be established by independent corroboration. In the said case, the Tribunal set-aside the demand of duty and observed that there being a conspicuous absence of actual diversion of the goods in the domestic market and flow-back of funds; a demand of duty cannot be sustained on the basis of mere statements made by the transporters of goods. In the present case, we have already stated that there is absence of evidence of the huge quantity of material of 103 consignments were sold in the open market, flow back of funds, etc. In such situation, CENVAT Credit can not be denied, on the basis of statements of the transporter, evidence of third party and the goods were not transported through the check post.
As per Section 14AA, if the Commissioner of Central Excise has reason to believe that the credit of duty availed of or utilized under the rules made under this Act by a manufacturer of any excisable goods; has been availed of or utilized by reason of fraud, collusion or any willful mis-statement or suppression of facts; he may direct such manufacturer to get the accounts of his factory, office, depot, distributor or any other place, as may be specified by him, audited by a cost accountant or Chartered accountant nominated by him. The cost accountant or Chartered accountant so nominated shall, within the period specified by the Commissioner of Central Excise, submit a report of such audit duly signed and certified by him to the said Commissioner mentioning therein such other particulars as may be specified. The manufacturer shall be given an opportunity of being heard in respect of any material gathered on the basis of the audit and proposed to be utilized in any proceeding under this Act or rules made thereunder.
Adjudicating authority had not directed to get the account of Appellant would be audited by a Cost Accountant or a Chartered Accountant as per the provisions of Central Excise Act, 1944. On the other hand, the appellant produced Cost certificate, Chartered Accountant certificate of utilization of input in the manufacture of final product. Therefore, the contention of the Adjudicating authority on this issue cannot be accepted. - demand of duty along with interest and penalty cannot be sustained. Accordingly, the impugned order is set aside - Decided in favour of assessee.
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2015 (4) TMI 995
Imposition of penalty - Whether the penalty under Rule 26 on the co-appellant can be waived if main appellant against whom duty interest and penalty has been confirmed, has paid duty, interest and 25% penalty in terms of proviso to Section 11A(2) - Held that:- Immunity provided under the proviso is available to only those persons to whom the notice is issued under Section 11A(1A). In the present case penalty on the appellant was proposed in the notice and imposed in the impugned order under Rule 26 of Central Excise Rules, 2002. Therefore the appellant is not covered under the category of the "other persons" as mentioned, under the proviso. Therefore in my view the immunity provided under the proviso is not applicable to the present appellant. From the said proviso, I am of the opinion that the term "person" and "any other persons" used in the proviso under Section 11A(2) means if in any case in the common show cause notice, if the duty demand was raised against more than one person under Section11A(1A) and duty interest and 25% of penalty proposed in the show cause notice is paid by both the person then against those both the persons proceedings will stand concluded, but if any other person on whom only penalty under Rule 26 of Central Excise Rules, 2002, or any other person is proposed then the proviso to Section 11A(2) is not applicable - However, considering the fact that total amount of duty confirmed is ₹ 2,79,803/- and also on the fact that entire duty, interest and 25% of penalty has been paid by the main appellant. I am of the view that the personal penalty of ₹ 50,000/- imposed on the appellant is higher side, therefore I reduce penalty of ₹ 50,000/- to ₹ 25,000 - Following decision of Commissioner of Central Excise, Raipur vs. Anand Agrawal [2013 (2) TMI 569 - CESTAT NEW DELHI] - Decided partly in favour of assessee.
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2015 (4) TMI 994
Cenvat Credit - Bogus invoices - Burden of proof - Held that:- Assessee is required to find out while taking Cenvat Credit to ensure that the input on which Cenvat Credit is taken, the relevant document is accompanied by them or not. Admittedly, in this case the appellant is able to produce the invoice against which appellant has availed Cenvat Credit and same has been entered in their RG -23 Register. Therefore, the burden cast on the revenue to prove that this is only a paper transaction and goods have not been received by the appellant at all. To ascertain this fact that appellant has not received the goods. The statement of transporter is very much relevant to find out the truth. Moreover, investigation at the end of investigation, manufacturer supplier also reveal the truth whether the manufacture supplier has supplied the goods to the appellant through the registered dealer or not. - appellant has produced invoice on the strength of which they have availed Cenvat Credit and the goods have been entered in their RG -23 register and same has been supported by the weightment slips which were produced by the appellant before the authorities below. When these material evidence are on record then the burden of not receiving the goods by the appellant shifts on the revenue which revenue failed to do so. - Decided in favour of assessee.
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2015 (4) TMI 993
Denial of refund claim - Unjust enrichment - Commissioner (A) held that as appellant has failed to produce any tangible evidence that they have passed the bar of unjust enrichment - Held that:- On perusal of the calculation sheet provided by the appellant and the invoices we find that while granting discount to their customers, the appellant included the prices reduction plus duty component and same has been ignored by the lower authorities while examining their refund claim. In these circumstances, we hold that it is the fact in record which is evident that the appellant has been able to prove that they have not recovered excess duty from their customers. Therefore, we hold that appellant has discharged the burden of unjust enrichment and consequently, is entitled for refund claim. - Decided in favour of assessee.
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2015 (4) TMI 992
Clandestine removal of goods - imposition of penalty u/s 11AC - Held that:- Excess stock of 259.50 KG of Supari, 690.20 KG of Gutkha and 4039 KG of Packing material by itself cannot be treated as an evidence of unaccounted manufacture of clearance of Kimti Brand Gutkha by RPPL during the period to which the entries in the notebook recovered from Shri Manoj Gupta pertaining for that period, there is no evidence of unaccounted purchase of principal raw material like Supari etc. As regards, the recovery of cash of ₹ 17,64,870/- from the residential premises of Shri Babu Lal Maqkhija and Shri Hira Lal Makhija and recovery of cash of ₹ 19 lakh from the residential premises of Shri Harish Makhija, in both the cases the stand of the appellant has been that this cash was meant for purchase of some property and was not for the sale proceeds of unaccounted Gutkha. In any case, in view of the judgment of the Apex Court in the case of Commissioner vs. Pandit DP Sharma reported in [2003 (5) TMI 507 - SUPREME COURT] the onus to prove that the currency represented sale proceeds of the clandestinely removed goods in on the department and it is the department which has to lead cogent evidence in this regard. But there is no such evidence. Therefore, the currencies recovered from the residential premises of Shri Babu Lal Makhija/Hira Lal Makhija Delhi and from the residential premises of Shri Harish Kumar Makhija -Kanpur cannot be held to be sale proceeds towards the clandestinely cleared goods.
Merely on the basis of the entries in the notebook recovered from Shri Manoj Gupta under the heading of Kimti coupled with his statement, it cannot be concluded that those entries represent clandestine clearances of the consignments of Kimti Brand Gutkha by RPPL and on this basis duty demand of ₹ 57,51,000/- cannot be confirmed against RPPL. In this regard, we are supported by the judgements of the Tribunal in the cases of Charriot Cement Company vs. CCE (2003 (1) TMI 213 - CEGAT, KOLKATA) and Hira Enterprises and others vs. CCE Belgaon (2011 (5) TMI 896 - CESTAT BANGALORE), wherein it has been held that merely on the basis of the Railway receipts without being corroborated by other independent evidence like unaccounted procurement of raw material, unaccounted manufacture, the duty demand cannot be confirmed against the assessee. In this case, even the railway receipts under which the consignments of Kimti Brand Gutkha are alleged to have been clandestinely cleared, had been booked are also not on record and it is not known as to whether the RR numbers mentioned in the notebook of Shri Manoj Gupta under the heading Kimti represent the actual railway receipt or not. Therefore, the duty demand of Rs, 57,51,000/- against the RPPL is not sustainable.
Since, the duty demand is not sustainable against RPPL, there is no question of imposition of penalty on Shri Hira Lal Makhija and Shri Harish Kumar Makhija under Rule 26 of the Central Excise Rule 2002 - Decided in favour of assessee.
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2015 (4) TMI 991
Condonation of delay - Change in office address - Held that:- Any dismissal of appeal at the threshold may turn an meritorious appeal into demeritious. So also the appellant shall be deprived of principles of natural justice. While we appreciate the principle laid down by apex court in Collector, Land Acquisition Anantnag and another Vs MST Katiji and others - [1987 (2) TMI 61 - SUPREME Court] and in N.Balakrishnan Vs M. Krishnamurthy - [1998 (9) TMI 602 - SUPREME COURT OF INDIA] and the reason stated in the dates and events chart filed by appellant, it does not appeal to the common sense how a litigant could be silent after participation in a proceeding without being for vigilant of outcome of the proceeding to act expeditiously for redressal of any wrong done to him. In the absence of vigilant attitude of the appellant, it is not possible to allow the application for condonation of delay for which that is dismissed. - Decided against assessee.
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