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2015 (9) TMI 522 - ALLAHABAD HIGH COURT

2015 (9) TMI 522 - ALLAHABAD HIGH COURT - 2016 (331) E.L.T. 513 (All.) - Extended period of limitation - wilful suppression of fact or commission of any fraud - suppression of production of goods and clandestine removal - Held that:- firstly the assessee had not produced invoices etc. despite being demanded by the Central Excise Officers vide letters dated 10.1.1990, 23.1.1990, 5.3.1990, 27.3.1990, 24.4.1990 and 14.5.1990 and when the Central Excise Officers visited the manufacturing unit on 17. .....

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the alleged fire accident to the concerned Central Excise Officers about the alleged fire accident except stating that the intimation was sent by letter under Certificate of Posting.

The concurrent findings of fact recorded by the fact finding authorities, as briefly noted above, clearly attracted the proviso to Section 11- A(1) of the Act. Removal of goods in the name of dummy unit and unestablished purchases from one M/s. Ajay Traders for trading purposes were clearly the result of .....

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Kesarwani ORDER (Per: Surya Prakash Kesarwani,J.) 1. Heard Sri Pankaj Bhatia, learned counsel for the appellants and Sri B.K. Singh Raghuvanshi, learned senior standing counsel for the respondent. 2. Learned counsel for the appellant submits as under: (i) The impugned final order No.895-897/2003-B dated 3.12.2003 passed by the Customs, Excise and Service Tax Appellate Tribunal, New Delhi, is wholly erroneous, inasmuch as, the Tribunal has not recorded any finding on invocation of the extended p .....

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t invocable. (iv) The burden to prove the suppression of fact of clandestine manufacture was on the Department which it failed to discharge. (v) The order was delivered by the Tribunal after 11 months of the hearing of the case and thus the order is bad in view of the law laid down by Hon'ble Supreme Court in the Case of Anil Rai Vs. State of Bihar (2001) 7 SCC 318. 3. In support of his submissions learned counsel for the appellants has relied upon the judgements of Hon'ble Supreme Court .....

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Toubro Ltd. Vs. Commissioner of Central Excise, Pune II 2007, 9 SCC 617, Joint Commissioner of Income Tax Surat Vs. Saheli Leasing and Industries Ltd. (2010) 253 E.L.T. 705 S.C., Chandna Impex Pvt. Ltd., Vs. Commissioner of Customs, New Delhi (2011) 269 E.L.T. 433 S.C., Anil Rai Vs. State of Bihar (2001) 7 SCC 318, Uniworth Taxtiles Ltd. Vs. Commissioner of Central Excise, Raipur (2013) 288 E.L.T. 161 S.C. and Commissioner of Central Excise Vs. Triveni Sheet Glass Works Ltd 2005(11) SCC 443. 4. .....

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unal. The findings recorded by the Adjudicating Authority and the Tribunal are findings of fact based on consideration of relevant material and evidence on record and as such they can not be interfered with in appeal. 6. He relied upon the judgments of Hon. Supreme Court in the case of Usha Rectifier Corpn (I) Ltd. Vs. Commissioner of Central Excise (2011) 11 SCC 571, Commissioner of Central Excise Visakhapatnam Vs. Mehta & Co.(2011) 4 SCC 435 and a Division Bench Judgment of this Court in t .....

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vt. Ltd. Company on 1.7.1990, in the name and style of M/s. Sharpe Carbon India Pvt. Ltd. The said Firm/Company was engaged in the manufacture of various stationery items including carbon papers and Sealing Wax etc. The Sector Officer of the respondent-Department wrote a letter dated 10.1.1990 followed by reminders dated 23.1.1990, 5.3.1990, 27.3.1990, 24.4.1990 and 14.5.1990 requesting the appellants to furnish invoices. Neither invoices were submitted nor any intimation in this regard was give .....

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dated 17.5.1990. When the records were asked to be produced, Sri Deepak Agarwal partner and General Power of Attorney holder of the appellants stated that the records were burnt in a fire accident on 20th April 1990 and an FIR was lodged with the concerned police station and intimation to the Central Excise Department was sent under Certificate of Posting on 20th April 1990. On the basis of the evidences available on record, a detailed show cause notice dated 25.11.1992 for the year 1987-88 and .....

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ting Authority considered the matter in detail and passed the order in original No.14 dated 4.2.2000 confirming the demand of Central Excise duty of ₹ 27,32,902.02 and also imposed penalty of ₹ 2 lakhs on the appellants under Rule 173-G of the Central Excuse Rules 1944 and the penalty of ₹ 2 lakhs each on Sri Deepak Agrawal and M/s. Rohit Enterprises. 10. Being aggrieved, the appellants and other co-noticees filed separate appeals before the Customs & Excise Appellate Tax T .....

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aggrieved the appellants have filed the present appeal. 13. In the impugned order the Tribunal has recorded following findings of fact: We have considered the submissions of both the sides. We observe from the perusal of the impugned order that the Commissioner has not accepted the plea of the appellants about purchase of carbon paper from M/s. AJAY TRADERS on the ground that the consignment Notes were dated 28.11.89,10.12.89, 20.12.89 and 11.2.90 whereas the Bills raised by Ajay Traders are da .....

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d not have been resold and further no bill or vouchers for resale of their goods had been submitted by the appellants even if the goods were resold, the figure cannot be taken into record as it does not amount to any additional sale. We also not find any substance in the submission of the learned Advocate that the quantum of excisable goods could not be arrived at from the Balance Sheet. The Balance Sheet is an important document which contains details of the entire year and the figures mentione .....

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statement dated 3.6.91, had deposed that Rohit Enterprises did not possess any machine for the manufacture of carbon paper, no technically qualified person had been employed in that unit. The Commissioner has rightly discarded the affidavit of K.K. Tripathi which has been given to the Department after more than one year. Even in the affidavit, he had confirmed that Rohit Enterprises had taken machines from the appellant. This shows that the appellants were having the capacity to manufacture the .....

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troverted. We, therefore, do not find any reason not to treat M/s. Rohit Enterprises as a dummy unit and the clearances shown against its name are, in fact the clearance made by the appellants. 8. Regarding Sealing Wax, we observe that the learned Advocate has shown a Sales Tax form reflect the sale of the same to Dilip Enterprises. The learned Advocate has also mentioned that the Tariff rate of duty is nil in respect of Lack falling under sub-heading 13.01.10 of the Schedule to the Central Exci .....

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rprises is set aside as it has been held to be a dummy unit. Penalty on Sh. Deepak Agarwal is also set aside as penalty has already been imposed on the partnership firm." 14. From the facts noted above, it is clear that the respondent Department had asked the appellants to furnish invoices vide letter dated 10.1.1990, followed by reminders dated 23.1.1990, 5.3.1990, 27.3.1990, 24.4.1990 and 14.5.1990, but the appellants did not comply. On an intelligence report that the appellants are indul .....

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o this effect was sent to the Central Excise Department under Certificate of Posting. The Central Excise Department Officers also inquired about the fire accident and raised doubt about the occurrence of fire accident and burning of Central Excise related records, since no damage was caused to furnitures etc. The Adjudicating Authority required the appellants to produce the records and Books of Accounts but they were not produced on the ground that records were burnt in fire accident. 15. Thus w .....

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fire accident nor any furniture in the premises get damaged. It is also relevant to note that although the appellants were knowing well that the Central Excise Officers are repeatedly asking certain documents to be produced yet they had not given any intimation with regard to the alleged fire accident to the concerned Central Excise Officers about the alleged fire accident except stating that the intimation was sent by letter under Certificate of Posting. All these facts and circumstances were .....

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cise department on 21.04.90. They have further stated that just prior to the fire accident, the Budge day stock taking and annual stock taking had been conducted in March 1990 and nothing adverse was noticed, the department, on the other hand, has expressed doubts or this version of the party in view of non-receipt of any intimation of fire, non-submission of documents despite repeated queries and the report of the sector officer who had investigated the fire accident and found that neither was .....

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hey purchased carbon papers from M/s. Ajay traders. To uphold the finding of Adjudicating Authority in this regard, the Tribunal observed that the alleged bills of Ajay Traders are dated 11.3.1990 against the alleged purchase order dated 21.1.990 whereas the alleged consignment notes were dated 28.11.1989, 10.12.1989, 20.12.1989 and 11.2.1990. The Tribunal found that the balance sheet was an important document, figures of which can not be simply brushed aside. The Tribunal also recorded a findin .....

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