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M/s Manwani Industries Ltd, Shri Tulsidas Manwani, Director Versus Commissioner of Central Excise, Service Tax, Indore

2015 (9) TMI 1321 - CESTAT NEW DELHI

Clandestine removal of goods - Shortage of goods found - Imposition of penalty - Held that:- There was shortage of finished goods of bars and rods weighing 36.830 MT on the date of visit of officers on 06.11.1996. The authorized representative of the appellant company clearly admitted the shortage as due to removal without accounting and without payment of duty. The use of parallel invoices for clearing unaccounted excisable goods without payment of duty stands admitted by the authorized signato .....

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₹ 39,87,886/-on clearances relating to 1st June 1996 and 31.10.96 as well as demand of ₹ 67255/- on the shortage found are upheld. As regards the penalty imposed, I note that the provisions of procedure of section 11AC are applicable from 26.09.1996 and the amount of demand relating to the period October 1996 having been quantified as ₹ 4,08,866/-. I, therefore, reduce the penalty - Decided partly in favour of assessee. - Appeal Nos. E/3482-3483/2004-EX(SM) - Dated:- 31-7-2015 .....

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ugned order contains long extracts in Hindi from the statements recorded from Shri Tulsidas Manwani, Laxmandas Manwani, Jagdish Chandra Joshi, Narayan Prasad Kothari and Shambhu Dayat Agarwat verbatim. It does not contain any discussion or the analysis of the evidence before the adjudicating authority. The impugned order is non-speaking and is passed without application of mind. This order, therefore, cannot be sustained. The order is accordingly set aside and the matter remanded to the original .....

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of hearing to the appellant parties. The appeals are thus allowed by remand in these terms." 2. The facts of the case are as under: The relevant facts, in brief, are that when the officers of Central Excise visited the appellant's factory on 06.11.1996 and checked stock of raw materials and finished goods; they found 2100 ltrs of furnace oil in excess of stock as per record which was 5800 ltrs; as regards the finished goods there was a shortage of 36.830 MT of bars and rods. The author .....

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d and there were no duty paying documents with the appellant company. A parallel book of invoices pre-authenticated by the Director of the company but not numbered was recovered. In addition, they have recovered private bill book based on which payments were made to the contractor two bills, on behalf of the contractor, were actually prepared by Shri J.C. Joshi, authorized signatory of the appellant company as the Partners of the contractor were said to be not literates. The authorized signatory .....

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use of parallel invoices book and that he had never given any instructions to clear any goods without payment of duty issuing the invoice book. However, he admitted having pre-authenticated the invoice book. Shri Tulsidas Manwani, the other Director stated that he was not involved in day-to-day affairs of the company and that Shri Joshi was responsible for day-to-day affairs of the company and that Shri Joshi was responsible for day-to-day affairs of production, clearance, accounts and, therefor .....

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arious persons including the appellant company. Commissioner adjudicated the show cause notice vide his order dated 30.09.1999, which was set aside by the Tribunal vide order dated 06.12.2001 for violation of principles of natural justice. The impugned order dated 30.12.2003 has been passed by the Commissioner in denovo proceedings. The matter is, thus, before the Tribunal for the second time. 3. The Tribunal vide order dated 17.09.2009 disposed of appeals and the appellants challenged the order .....

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were allowed. In consequent to this, appeals are listed before me for hearing. 4. The main ground of the appellants is that the cross examination of the witnesses namely Shri Jagdish Chandra Joshi, Shri R P Srivastava, Shri Santosh Kumar Sahu & Shri Narayan Sahu was not afforded to the appellants. Therefore, impugned order is not sustainable. He also drew my attention to the show cause notices and the Annexure to the show cause notices to show there is a difference in quantities of goods sh .....

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Sahu. The request of cross examination was considered by the Adjudicating Authority and given the findings as under: The request of the Noticee No.1 was considered by me and my observations are as under:- (i) Shri Jagdish Chandra Joshi, Excise Clerk & Authorised Signatory of the unit He is co-noticee in the present case. He admitted shortage in stock and confirmed that it was due to removal without payment of duty. He also admitted removal of goods in past under cover of parallel invoices. .....

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invoices. Even after 06.11.1996, when shortage was noticed and his statement was recorded, Mr. Srivastava was working with the noticee. It is not an argument of the noticee that the statement of Shri Srivastava, implicating the noticee was recorded under duress. Shri Srivastava also never retracted from his statement under Section 14 of the Act. The noticee have made a mechanical request for his cross examination without any justification for bringing out any facts on record to show as to why hi .....

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inst both sets of bills had been accepted by these contractors. The noticee have made mechanical request for cross examination without any justification or bringing out facts on record to show, necessity of cross examination. 8. I have gone through the observations of the Ld. Adjudicating Authority for denial of cross examination and found is correct. 9. With above observations, request of cross examination of the witnesses by the appellant is rightly set aside by the Adjudicating Authority. 10. .....

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ring the course of hearing, it was asked from the Ld. Counsel for the appellants to provide a copy of the invoices which were given to the appellants along with show cause notices but Ld. Counsel for the appellant did not produce these invoices. As these invoices were not produced by the Ld. Counsel before me, it would lead to draw the inference contrary to claim of the appellants. As revenue has alleged that the quantity mentioned in the invoices and backside thereon are shown as clandestinely .....

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removal without accounting and without payment of duty. The use of parallel invoices for clearing unaccounted excisable goods without payment of duty stands admitted by the authorized signatory. The Director, Shri Laxmandas Manwani while admitting having authenticated the invoice book claimed that he has not given instructions to clear any goods without payment of duty. The other Director, Shri Tulsidas Manwani merely stated that he was not involved in day-to-day affairs of the factory but he ha .....

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d by the admission statement of Sh. Santosh Kumar and Shri Narayan Prasad representing the contractor firm. These three persons have not retracted their statements. The main demand relates to the period June 1996 to October 1996. The appellant company contest this demand ₹ 39,87,886/- as having been raised without any basis. It was submitted that the amount has been calculated on the basis of amount which was mentioned at the back of the bill which was raised by the contractor for loading .....

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is amount was mentioned at the back of the bill which was raised for loading and unloading. These submissions, in my view, are clearly after thought and it is clearly contrary to the evidence tendered by Shri Joshi who admittedly prepared the bills on behalf of the contractor and the corroboration given by Shri Santosh Kumar and Shri Narayan Prasad of the contracting firm. Further the shortage of finished goods on the date of visit by the officer, the recovery of un-numbered pre-authenticated in .....

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