TMI Blog2010 (2) TMI 1044X X X X Extracts X X X X X X X X Extracts X X X X ..... - decided partly in favor of appellant. - E/2829 and 2846/2003 - Final Order Nos. A/37-39/2010-WZB/MUM/C-II/EB - Dated:- 19-2-2010 - Shri P.G. Chacko and M. Veeraiyan, JJ. Shri S.M. Vaidya, JDR, for the Appellant. Shri S.P. Mathew, Advocate, for the Respondent. ORDER Appeal No. E/2829/03 is filed by the Department against the order of the Commissioner (Appeals) No. SDK (157-163) 157-163/M-V/2003, dated 30-6-2003 against the relief given to the respondent M/s. Champion Confectionery. Cross-objection No. E/CO/208/04 filed by M/s. Champion Confectionery is connected to this appeal challenging the part of the demand confirmed by the Commissioner (Appeals). 1.1 Appeal No. E/2846/03 is filed by Shri Vishwas Waikar against the order of confiscation of the vehicle which was upheld by the above mentioned order of the Commissioner (Appeals) dated 30-6-2003. 1.2 As the appeals and Cross-objection are arising out of the same impugned order, they are being disposed of by this common order. 2. Heard both sides. 3. The relevant facts, in brief, are that the Central Excise officers intercepted a Tempo bearing registration No. MH-04 S-9479 on 1-7-2000 and found consignmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e procedures and without payment of Central Excise duty. The statement of Shri K.B. Dedhia has been corroborated by the statement dated 3-7-2000 of Shri Mehul D. Hariya, partner of M/s. Creative Marketing. 3.4 The statements of the supervisors of the manufacturing unit, the transporter and some of the dealers of biscuits, who purchased goods from M/s. Creative Marketing corroborated unaccounted manufacture, transportation and sale of goods without bills and without payment of duty. 3.5 M/s. Champion Confectionery deposited a sum of Rs. 1,00,000/- by TR-6 challan on 10-7-2000 towards part of the duty involved on such clandestine clearance. 4. A show-cause notice dated 26-12-2000 was issued proposing demand of duty of Rs. 10,15,035/- alongwith interest and proposing confiscation of the seized goods and the vehicle and proposing penalty on various concerned persons. 4.1 The original adjudicating authority by order dated 30-8-2001 confirmed the demand of duty of Rs. 10,15,035/- alongwith interest and imposed equal amount of penalty under Section 11AC; he confiscated the goods seized from the tempo valued at Rs. 1,80,898/-, but allowed the same to be redeemed on payment of fine ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nto the account enhanced exemption limit prescribed by Notification No. 47/2000 dated 1-9-2000. For this purpose, he remanded the matter to the original authority. 5. Learned DR submits that the case involves suppression of production and clandestine removal by adopting ingenious method, with a view to avail the exemption beyond the limit of Rs. 50 lakhs and the unit has chosen to clear the goods using cash-memo of M/s. Globe Food Products and also using plain chits. This is confirmed by the interception of goods in transit after clearances from the manufacturing unit and also corroborated by unaccounted stock valued about Rs.5 lakhs found in the premises of the factory on the date of visit by the officers. The suppression of the production is evident from the statements of the Supervisors of the manufacturing unit, statements of Manager-cum-authorized signatory (Shri Kamath) and the proprietor of the manufacturing unit. The entire production by manufacturing unit was being sold through their sister concern M/s. Creative Marketing and the statement of the Accountant and partner of the Marketing concern clearly confirm the suppression of production and clandestine clearances. Sinc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecorded, the clearances of 50% are not being unaccounted and that the entries in the RG-1 register are only of the accounted clearances. A perusal of the entries in the RG-1 register and the clearances would show that this is contrary to facts. He also submits that the question of adopting assumed figure of 50% not corroborated by any supporting evidence is not legal and proper. He also submits that the differential duty relating to period beyond 1-7-2000 merely depends upon interpretation of the Notification and no penalty under Section 11AC is attracted in respect of the short levy, if any, from 1-7-2000. 6.1 The learned Advocate on behalf of the vehicle owner Shri Vishwas Waiker submits that the appellant was not having any knowledge about the non-duty paid nature of the goods transported in his tempo by the driver. Therefore, he submits that lorry should not be confiscated under Section 115 of the Customs Act, 1962. He relies on the decision of the Tribunal in the case of K. Subramanian v. CCE, Coimbatore reported in 2006 (205) E.L.T. 1159 and the decision of the Tribunal in the case of S. Duraiappa v. Commissioner of Customs, Chennai reported in 2006 (202) E.L.T. 365 (Tri-Ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nting the respondent strongly assails the reliance of the statements for arbitrarily enhancing the value of clearances. He submits that the statements of these four persons heavily relied upon by the Department stand retracted by way of affidavits filed on 4-7-2000 and 6-7-2000. 9. One of the main issues to be considered is whether the retraction said to be contained in the affidavits was rightly relied upon by the Commissioner (Appeals). As already mentioned, there was seizure of clandestinely removed goods in the transit and there was unaccounted stock of about Rs. 5 lakhs in the factory premises and that there were slips Sr. No. 43 to 50 all dated 30-6-2000 indicating clandestine clearance of goods valued at Rs. 1,40,575/-. In these circumstances, there can be no doubt about the fact of clandestine removal indulged in by the respondent firm. It is only the quantum of such clearances, which can be in dispute. Several persons concerned with the respondent firm and the marketing firm have admitted and corroborated the clandestine clearance by the respondent firm. Some of the dealers who purchased from the marketing firm also confirmed receipt of goods without bills. These admissi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gnatory of the respondent firm that nearly 50% of the clearances were made without payment of duty and corroborated by others concerned. Considering the evidence relating to excess unaccounted stock found in the factory on the date of visit and the quantum of unaccounted clearances effected on 30-6-2000 and 1-7-2000, it is reasonable to conclude that the clandestine clearances are substantial. 9.1 Further, it is noticed that when the consignment was intercepted on 1-7-2000 out of the total goods valued Rs. 1,80,898/-, goods valued Rs. 1,29,730/- was found to be unaccounted and only goods valued Rs. 51,168/- was covered by invoice No. 82 dated 1-7-2000 issued by the respondent firm. In other words, the unaccounted clearances were more than twice the accounted quantity. In these circumstances, the claim of Shri Kamath that 50% of the goods only were cleared without bills and without bringing to account appears to be an understatement. In view of the above, the original authority adopting the 50% clearances as unaccounted, as revealed by the authorized signatory cannot be faulted. Therefore, the order of the Commissioner (Appeals) in setting aside the said finding is erroneous. 9. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of any conveyance proves that it was so used without the knowledge or connivance of the owner himself, his agent, if any, and the person in charge of the conveyance or animal . In this case, the burden to prove that the offending goods were not carried with the knowledge of the owner or the agent of the concerned person disposed off by allowing the option of redemption to the owner of the vehicle on payment of redemption fine of Rs. 30,000/-. In the present case, undisputedly the person in charge of the conveyance was the driver and he was in the knowledge of transporting of the offending goods. Under these circumstances, the confiscation of vehicle requires to be upheld. The case laws relied by the learned Advocate were not based on the finding that the person in charge of the vehicle was knowing the offending nature of the goods transported. Therefore, the said case laws are not applicable to the facts of the present case. However, the option of redemption of the vehicle should have been given to the owner of the vehicle and not to M/s. Champion Confectionery. 9.4 The issue relating to the re-determination of the duty liability taking into account the effect of the Notificati ..... X X X X Extracts X X X X X X X X Extracts X X X X
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