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M/s. NGA Steels Pvt. Ltd. Versus CCE, Salem

Duty demand - Shortage of goods - Clandestine removal of goods - violation of natural justice - Held that:- There is no material coming up even today in the course of hearing from the appellant to discard the allegation of issuance of parallel invoices by the appellant to the four buyers as is stated in Sl. No. (ii) to (v) of para 1 appearing at the outset of this order to demonstrate that removal of the quantity of the goods to them had suffered duty. The JMD who was present on the spot on the .....

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quantum of unaccounted transactions entered into between the appellant and those buyers. - At no point of time the appellant discarded the evidence gathered by investigation to defend against issuance of parallel invoice nor demolished the stand of investigation adducing any evidence to the contrary. Burden of proof was discharged by Revenue. Allegation of clandestine removal was established from cogent evidence and Revenue proved its case with precision without the adjudication being made under .....

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hri D.N. Panda, Judicial Member For the Appellant : Shri A. Mudimannan, Advocate For the Respondent : Shri B. Balamurugan, AC (AR) ORDER Learned counsel submits that following demand of duty arose on account of allegation of: i. Shortage of raw materials viz. ingots & billets - ₹ 4,57,228/- ii. Clandestine removal of steel products to M/s. Sri Lakshmi Steels, Coimbatore - ₹ 6,41,531/- iii. Clandestine removal of steel products to M/s. South India Steels, Erode - ₹ 2,09,322/ .....

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he allegation of shortage of stock of 68.625 MTs of ingots and 71.510 MTs of billets and duty thereon was demanded to the above extent. Penalty and interest was also levied. 3. So far as the rest of the demand of duty of ₹ 8,80,037/- covered by Sl. No. (ii) to (v) of para 1 aforesaid is concerned, that arose on allegation of clearance of steel products to M/s. Sri Lakshmi Steels, M/s. South India Steels and M/s. Sree Sakthi Steel as well as to M/s. Pournami Steels. The allegation of the De .....

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ived of the course of natural justice during first adjudication for which it was in the first round of litigation before the Tribunal. Considering its grievance, vide Tribunals Final Order No. 1312 & 1313/2011 dated 16.12.2011, Tribunal held that the appellant is entitled to fresh hearing on the issues of limitation and concessional penalty if any admissible shall be allowed as well as opportunity of rebuttal shall be allowed which was denied in original adjudication made by Order-in-Origin .....

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appellant, so far as the demand of ₹ 4,57,228/- is concerned, learned Commissioner (Appeals) in para 4 of his order dealt the issue and without appropriately converting the quantity of the ingots and billets inventorised in the course of investigation into MTs, reached to the conclusion that there was shortage of 68.625 MTs of ingots and 71.510 MTs of billets. His conclusion is incorrect in absence of any rational basis for conversion of the quantity expressed in terms of numbers into weig .....

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oming up even today in the course of hearing from the appellant to discard the allegation of issuance of parallel invoices by the appellant to the four buyers as is stated in Sl. No. (ii) to (v) of para 1 appearing at the outset of this order to demonstrate that removal of the quantity of the goods to them had suffered duty. The JMD who was present on the spot on the date and time of investigation had no answer to the parallel invoices issued by appellant in respect of the alleged clearance to t .....

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material evidence before him and tested the same as recorded in para 3.1 to para 9.4 of his order dated 3.2.2011. He summarized his conclusion on investigation result in para 10.1 of the order and tested the same with evidence on record. That is reproduced below for reference:- NGA, manufacturers of TMT Bars/ CTD Bars and Rods have clandestinely removed the same to various parties without raising invoices / and also clandestinely removed the goods more than once on an Invoice already raised, wit .....

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of the Sales Invoices raised by NGA with that of the trip details of vehicles owned by Shri D.Murugesan, who is one of the Directors of NGA and vehicle owned by Smt. N.A. Seethalakshmi, w/o Shri N. Anbazhagan, Director, NGA. The trip details of both the above vehicles have been written y Shri B. Murugesan and Shri B. Murugesan has affirmed this fact. The clandestine purchases made by the parties mentioned above have been further corroborated by them in their respective depositions made under sec .....

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to defend against issuance of parallel invoice nor demolished the stand of investigation adducing any evidence to the contrary. Burden of proof was discharged by Revenue. Allegation of clandestine removal was established from cogent evidence and Revenue proved its case with precision without the adjudication being made under surmise or suspicion. 7.5 Learned counsel vehemently opposed the demand as time barred. Such defence plea is only pulpable. Cogent evidence gathered by investigation and te .....

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quence of law to apply. No interference to the order passed by learned Commissioner (Appeals) is therefore called for. However, the appellant shall get concessional penalty as has been recorded by learned Commissioner (Appeals) in absence of any good reason shown by Revenue at this stage to deny the same. So also in absence of appeal by Revenue against that relief, that is not reversible. 8.1 So far as demand of ₹ 4,57,228/- is concerned, the defence plea is that the inventory made on the .....

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ation as to the conversion aspect of the quantity into MTs of goods found short in respect of both category of goods. Learned Commissioner (Appeals) has erroneously recorded that investigation made calculation of shortage taking the average weight of one piece of ingot and one piece of billet and multiplying that with the total quantity of goods of both types of goods found the shortage irrationally. Revenue denies all such pleadings submitting that to be devoid of merit. 9. Bureau of Indian Sta .....

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adopted by investigation was the methodology followed by appellant to mention in its return filed before the excise authority warrant consideration. If that method is followed to disclose the tonnage of the goods manufactured and cleared in its returns furnished to the excise authorities, then the appellant cannot press to follow BIS norm to determine the shortage in terms of MTs. 10. The authority shall follow the above guideline to determine the alleged shortage of goods found during inventor .....

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