TMI Blog2010 (11) TMI 275X X X X Extracts X X X X X X X X Extracts X X X X ..... that the seized item was not manufactured by it, but was a duplicate product and the reasons given by him indicating that it was a duplicate product cannot be ignored . The revenue has failed to produce even a single piece of evidence that the seized goods were manufactured by the respondent or they were clandestinely removed without payment of excise duty from the factory premises of the respondent - The revenue has sought to levy excise duty and penalty on the respondent merely on the basis of assumptions and presumptions and such a course is not permissible in law - Thus, question is answered by holding that for want of evidence, the Tribunal was justified in not fastening the liability on the respondent and dropping the proceedings against him. - 20 of 2009 - - - Dated:- 19-11-2010 - Shantanu Kemkar and Prakash Shrivastava, JJ. REPRESENTED BY : S/Shri Vinay Zelawat with Abhishek Tugnawat, Counsels, for the Appellant. S/Shri P.K. Saxena, Sr. Counsel, with Vivek Gautam, Counsel, for the Respondent. [Judgment per : Prakash Shrivastava, J.]. - This appeal under Section 35G(2) of the Central Excise Act, 1944, filed against the Final Order No. 1482/2008-SM [B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id Gutkha consignment to the persons, who brought copy of the LR s and delivery memo/cash receipts. The summons were also issued to the respondent and statement of Nitesh Wadhwani, the Proprietor of the respondent was recorded and thereafter, the show cause notice dated 24-11-2004 was issued to the respondent for confiscation of goods under Rule 25 of the Central Excise Rules, 2002 and for payment of Central Excise duty on these goods under Section 11A(1) of the Central Excise Act, 1944, by mentioning that the respondent appeared to have clandestinely cleared 40 bags of Gutkha seized from the premises of Vaishali Cargo Carrier, Chennai without payment of excise duty. The levy of penalty under Rule 25 was also proposed. The respondent filed reply to the show cause notice and the Deputy Commissioner of Custom and Central Excise Division, Indore passed the Order dated 30/31 August, 2005, dropping the proceedings initiated against the respondent by holding that there was no evidence to establish that the said 40 bags of Gutkha was manufactured and clandestinely cleared by the respondent without payment of excise duty. The Commissioner (Appeals) - I by order dated 28th November, 2006, a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Delivery Assistant of M/s. Vaishali Cargo Carrier, Chennai, were recorded, but they have not stated that the seized goods were manufactured by the respondent or received from the respondent or transported at the instance of the respondent. The clear stand of the respondent before the authorities was that the seized goods were not manufactured and were not cleared by the respondent without payment of excise duty. The respondent in his reply to the show cause notice had stated that the seized 40 bags of Shimla Gutkha did not belong to him and the seized Gutkha was probably a duplicate product using his brand name. In the reply he had disclosed the reasons which support his suspicion about the seized goods being a duplicate product. He had also stated that he had never sold his product in Delhi market and that the manner the product was packed was different from his mode of packing the product. He also took the further plea that he had never transported any consignment through carriers in question. Before the excise authorities, the respondent had expressed inability to produce the relevant excise record since on 24-6-2004, his factory was searched by Central Excise Headquarters Preve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t in case of provisional release of the seized goods to them which if they claim to protect their Brand name they will clear it on payment of duty. On the contrary, he has categorically stated that they have neither sold any goods Delhi based dealers nor have booked any consignment through M/s. Vaishali Goods Carrier, Delhi and I find that nothing has been brought on record to disprove it. Whereas, the Show Cause Notice is silent as to who had actually booked the consignment at M/s. Vaishali Goods Carrier, Delhi. Further, follow up action at end of M/s. Vaishali Goods Carrier, Delhi or at the end of M/s. Kuber Group of Companies, against whom the original follow up of searches was conducted seems to be was not carried out. 5. Further, no evidence is brought on record to establish that the 40 bags of Shimla Brand Gutkha in total valued at Rs. 8,73,600/- (MRP) seized under Mahazar dated 26-5-04 drawn at the premises of M/s. Vaishali Cargo Carriers. No. 96/181, Broadway Chennai-600-108, were manufactured and Clandestinely cleared by the Noticee. Further, the said goods seized on 26-5-04 are not established to have been removed without payment of Central Excise Duty on it, the same ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or they were cleared from the factory premises of the respondent clandestinely without payment of the excise duty. He has failed to point out any evidence, which could attract the levy of excise duty or penalty under the provision of Acts and Rules as against the respondent, in the given facts of this case. 9. The Supreme Court in the matter of Oudh Sugar Mills Ltd v. Union of India reported in 1978 (2) E.L.T. (J172) (S.C.) had set aside the levy of additional excise duty and fine since the excise duty was levied on assumption and presumption without there being any evidence of removal of goods without payment of excise duty. The Supreme Court in that case held that :- B...... In the circumstances therefore, we must hold that the finding that 11,606 mauls of sugar was not accounted for by the appellant has been arrived at without any tangible evidence and is based only on inferences involving unwarranted assumptions. The finding is thus vitiated by error of law. 10. In the matter of Commissioner of C. Ex., Ludhiana v. Rakesh Nayyar reported in 2010 (255) E.L.T. 234 (P H) in a case, where no material was brought on record to show as to whom imported goods were sold and ho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssession of the specified goods within the Calcutta metropolitan Area. 21. However, the contention of Mr. Chakravarty is that when specified goods are found in possession of a person and when he, on being required to produce before the authority any accounts, register or document under sub-section (6) of Section 14, has failed to do so, a presumption arises that the specified goods have been brought by him into the Calcutta Metropolitan Area without payment of tax. We are afraid, we cannot accede to this contention. A presumption is a rule of law which requires the court to draw a given conclusion on proof or existence of certain facts and leaves it to the party disputing the conclusion to rebut the same. Presumptions may be of fact or of law. A presumption is an inference sanctioned by law which does not logically or necessarily follow from the proved facts. For raising a presumption, as submitted by Mr. Chakravarty, there must be a specific provision in the Entry Tax Act. No provision in the said Act is brought to our notice which may enable the authority to raise the presumption that a possessor of the specified goods, who fails to produce before the authority his accounts, re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that he was also manufacturing Gutkha by brand name Shimla , only on that basis it cannot be conclusively held that the seized item was manufactured and cleared by the respondent. The written explanation of the respondent that the seized item was not manufactured by it, but was a duplicate product and the reasons given by him indicating that it was a duplicate product cannot be ignored. There is no admission in the statement of Nitesh Wadhwani that the seized product was manufactured by him or it was cleared from his factory premises without payment of Excise duty, therefore, the statement of Nitesh Wadhwanim, is not sufficient to initiate the action against the respondent and fasten the liability of excise duty as well as the penalty on respondent without there being any cogent evidence on record establishing the necessary ingredients for levy of excise duty and penalty as against the respondent. 16. The statement of Nitesh Wadhwani, was duly taken note of and considered by the Deputy Commissioner Customs and Central Excise in its order dated 30/31 August, 2005. The Tribunal has also noted the statement of Nitesh Wadhwani, in paragraph one of the order and it cannot be held tha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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