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2015 (9) TMI 1379 - CESTAT MUMBAI

2015 (9) TMI 1379 - CESTAT MUMBAI - TMI - Penalty under Rule 26 of the Central Excise Rules 2002 - Purchase of clandestinely cleared goods - Held that:- it is an admitted position that incriminating documents were recovered from the appellant's office in Mumbai, which indicated that the appellant has purchased clandestinely cleared goods from the manufacturer. In his statement, both the manufacturers and brokers have admitted the position. - penalty imposed is in order. Further, penalty imposed .....

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aces of the appellant including the office in Mumbai and factory in Nashik, etc. were searched, besides, certain places of brokers. Certain incriminating documents were recovered from the office of the present appellant. These documents indicated that the appellant has purchased clandestinely cleared MS Ingots and MS bars from various manufacturers. Based upon these documents, statement of Shri Pravesh Roshanlal Gautam was recorded who explained the documents and admitted the purchase of the goo .....

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the appellant submits that out of three appeals, in two appeals No. E/1387/10 & E/1388/10, the manufacturers have paid duty, interest and 25% of penalties as required under Section 11A(1A) and the matter has been closed in respect of two appeals. He further submitted that in view of the judgment of this Tribunal in the case of CCE, Raipur (CG) vs. Jay Prakash Agarwal reported in 2013 (297) ELT 554 (Tri-Del), no penalty is to be imposed on the present appellant and the matter should have been .....

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is no dispute that the present appellant has purchased clandestinely cleared goods without payment of duty and in view of the said fact, the appellants are liable to penalty, the penalty imposed is not on the higher side. 4. We have considered the rival submissions. 4.1 As far as the appeal No. E/1387/10 and E/1388/10 are concerned, we find that the matter is covered by the Tribunal's judgment in the case of Jay Prakash Agarwal (supra). The period involved in the present case is prior to th .....

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neous been made" i.e. the person who is liable to pay the duty. The question arises as to which persons are covered by the words "other persons". Though the appellant have cited Division Bench's judgment in case of Sonam Clock Pvt. Ltd. (supra), on going through this judgment it is seen that the same is not on the issue involved in this case. The issue decided in this case is as to whether the benefit of 1st proviso to Section 11A(2) can be extended when the assessee could not .....

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ified by the expression "to whom Notice are served in sub-section (1)", the words "other person" would not cover, those persons who have been show caused by the same show cause notice for imposition of penalty under Rule 26 and as such the words "other persons" would include only the persons from whom the duty not paid, short paid and erroneously refunded is to be recovered. With due respect, in my view, this view of the Tribunal in the case of Anand Agrawal (supra) .....

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other persons" in first proviso to sub-section (2) have to be given a meaning different from the words "such person". Revenue's contention would have been correct if the words "other persons" were not there in 1st proviso to Section 11A(2) and in that case, there would have been no scope for doubt that on compliance with the provisions of Section (1A), only the proceedings against the person chargeable with duty would stand concluded. But since the Legislature has us .....

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uld cover the co-noticees/persons who face the allegations of contravention of Central Excise Rules, which are linked with the allegation of deliberate/fraudulent short payment, non-payment or erroneous refund of duty against the person chargeable with duty facing the duty demand i.e. the persons who are alleged to have knowingly dealt with the excisable goods, liable for confiscation in the manner mentioned in Rule 26(1) of the Central Excise Rules, 2002 and for this reason have been show cause .....

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who had purchased the goods, transporters who had transported the goods cleared by manufacturer/assessee, the Directors/employees of the manufacturer/assessee company. 8.2 For the purpose of settlement of a case, Section 31(a) of Central Excise Act, 1944, defines "assessee" as any person who is liable for payment of excise duty assessed under this Act or any other Act and includes any producer or manufacturer of excisable goods or a registered person under the Rules made under this Ac .....

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Act or under any other law for the time being in force. Tribunal in case of Shitala Prasad Sharma v. Commissioner of Central Excise, Mumbai-I, reported in 2005 (183) E.L.T. 21 (Tri.-Mumbai) relying upon Apex Court's judgment in case of Union of India v. Onkar S. Kanwar reported in 2002 (145) E.L.T. 266 (S.C.) and also the Tribunal's judgment in case of D.P. Kothari reported in 2001 (135) E.L.T. 669 has held that when the matter has been settled by the Settlement Commission against the m .....

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