TMI Blog2012 (4) TMI 432X X X X Extracts X X X X X X X X Extracts X X X X ..... ion – appellant with other parties who had dealt with the illicitly diverted resin knowingly are liable for confiscation and penalty under Rule 26 of CER, 2002 - upheld imposition of penalty - against assessee. - CEAC 44/2011, CEAC 45/2011, CEAC 46/2011, CEAC 41/2011, CEAC 42/2011 - - - Dated:- 9-4-2012 - MR. JUSTICE SANJIV KHANNA, MR. JUSTICE R.V.EASWAR, JJ. For Appellant: Ms.Seema Jain with Mr.Ajay K.Jain Ms.Savita Singh, Advs. For Respondent: Mr.Kamal Nijhawan , Sr.Standing Counsel with Mr.Sumit Gaur, Adv. SANJIV KHANNA, J: (ORAL) These appeals under Sections 35G of the Central Excise Act, 1944 ( Act for short) arise out of a common order passed by the Customs Excise and Service Tax Appellate Tribunal ( Tribunal in short) dated 4th July, 2011. As the facts are similar and the issues raised are interconnected, we deem it appropriate to examine the issues and contentions raised in this common order. 2. Appeal No.42/2011 filed by the Natraj Plast Industries Ltd., for the sake of convenience and with the consent of the counsel for the parties, is treated as the lead case. 3. The contention of the appellant is that the impugned order passed by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hey were changing the flexibility of the compound by changing the quantity of stabilizer etc. and that in the manufacture of PVC Compound they were using Resins of 6701 grade manufactured by M/s. Reliance, Shri Ram Industries and M/s. Finolex to the extent of 56%, that the Resin CP 172 SG procured by them from M/s. Camplast was being used in the manufacture of PVC Filler Cord where it was being added to the extent of 25% and that surplus quantity of CP 172 SG resin left after manufacture of the PVC Filler Cord was being sold to the manufacturers of battery separators without any invoice or bills and that he was doing so as his financial condition was not good, in the subsequent statements dated 28.08.2006 and 22.09.2006, he however, claimed that in addition to manufacturer of PVC Filler Cord, CP 172 SG Resin was also being used in the manufacture of PVC Tapes to the extent of 56%. However, the quantity of PVC Tapes using CP172SG Resin Claimed to have been manufactured is only 411.31 MTs in which the use of CP 172 SG Resin would be to the tune of 230.80 MT only and total use of CP 172 SG Resin including its use in the manufacture of Filler Cord would be to the tune of 334.8 MT only ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he department‟s allegation based on test report of CIPET, Lucknow in respect of sample of PVC tape manufactured by M/s Natraj in presence of investigating officers by using CP1725G resin to the extent of 56% is that CP172 SG resin has not been used in the manufacture of PVC tape supplied to M/s Motherson Sumo Systems and other buyers, as the elongation, tensile strength, tear strength and shrinkage of the sample of the PVC tape supplied to M/s Motherson Somu, which are claimed to have been manufactured by using CP172 SG resin are different. But on this point we agree with the appellants Plea that this difference in elongation, shrinkage, tensile strength and tear strength of the PVC tape manufactured in presence of the officers and the PVC tape supplied to M/s Motherson Sumo may be due to :- (a) Difference in thickness 0.4mm the case of PVC tape manufactured in the presence of officer and 0.3mm in case of PVC tape supplied to M/s Motherson Sumo; (b) Minor change in ratio of CP 1725G resin, plasticizer, filler, stabilize and master batch and difference in the temperature at which the product has been extruded; and (c) Difference in the method of testing while CIPET has t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... scation under the Act or these Rules. We do not find any merit in the said contention and the same has been rightly rejected in view of the decision of the Supreme Court in Agarwal Trading Corporation and Ors v. Assistant Collector of Customs, Calcutta ( 1983 E.L.T. 1467 SC) in which it has been held:- The second contention that because the firm is not a legal entity, it cannot be a person within the meaning of Section 167(3), (8) and (37) of the Sea Customs Act, is equally untenable. There is of course, no definition of person‟ in either of these Acts but the definition in section 2 (42) of the General Clauses Act 1897, or section 2 (3) of the Act of 1868 would be applicable to the said Acts in both of which person‟ has been defined as including any company or association or body of individual, whether incorporated or not. It is of course contended that this definition does not apply to a firm which is not a natural person and has no legal existence, as such clauses (3), (8) and (37) of section 167 of the Sea Customs Act are inapplicable to the appellant firm. In our view, the explanation to section 23C clearly negatives this contention. In that a company for the pu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal:- Shri Dinesh Gupta in his statements, while claiming the use of certain quantity of CP172 SG Resin purchased by him for manufacture of PVC Filler Cord, PVC Tapes admitted that substantial quantity had been sold as such without reversing the Cenvat credit and that some of the parties to whom CP 172 SG resin had been sold were Shri Rajesh Mittal of M/s. Aditya plastics, Shri Sunil Mittal of M/s. Mukesh Industries and Shri Rajesh Bansal, Proprietor of M/s. Micro Sec Industries. On inquiry with Shri Rajesh Mittal of M/s. Aditya Plastics, it was found that they were purchasing CP 172 SG Resin directly from M/s. Chemplast and that the quantity was being sold mostly under invoices, but for supply of this resin to the manufactures of battery separators, who wanted the same without invoices, they were procuring this resin from M/s. Natraj who was supplying the same without any invoices. Shri Sunil Mittal of M/s. Mukesh in his statement dated 7.7.2006 admitted that he was purchasing the CP 172 Sg Resin directly from M/s. Chemplast and also from M/s Natraj Shri Rajesh Bansal, Proprietor of M/s. Micro Sec in his statement dated 3.7.2006 admitted that he was engaged in the manufacture o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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