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2015 (11) TMI 1243 - CESTAT MUMBAI

2015 (11) TMI 1243 - CESTAT MUMBAI - TMI - Evasion of duty - Clandestine clearance of goods - Imposition of penalty u/s 11AC - Held that:- The final statements were recorded after showing the details and appellant No 1 and 2 have admitted of having clandestinely cleared goods without recording in the statutory records. It is well settled position in law that whatever has been admitted need not be proved. The admission of clandestinely clearance was admitted and continue to be admitted till date. .....

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on to evade payment of duty. We also note that appellant No. 2 has submitted that penalty cannot be imposed on him being partner of appellant No. 1 and penalty has been imposed on the appellant No 1. We find from the order that on appellant No. 1 penalty imposed is under Section 11AC of the Central Excise Act, 1944, while in case of appellant no. 2 penalty has been imposed under Rule 26 of Central Excise Rules, 2002. Purpose of Rule 26 and Section 11AC are different. - No merit in appeal - Decid .....

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ed in Nashik were indulging in large scale evasion of Central Excise duty by clearing finished goods clandestinely through a broker namely Shri. Umesh Modi, searches were conducted on 18/12/2006 on various places which included the factory of M/s. Shri. Salasar Ispat Pvt. Ltd. and that of M/s. MITC Rolling Mills Pvt. Ltd. Searches were also conducted in the office premises of M/s. Shri Salasar Ispat Pvt. Ltd. located in Mumbai as also the premises of broker, Shri. Umesh Modi in Mumbai. 1.1 From .....

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goods, quantity and rate, overall value of the goods and also name of the supplier. These note books give details of various suppliers which includes Appellant No. 1 in the present case as also details of the customers. These goods were originally cleared by the manufacturers without payment of duty through broker Shri. Umesh Modi during the said period. In addition to these two note books, four other palm sized diaries were recovered which have similar details for the period from Apr 2006 and f .....

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hrough the said broker. Details in the said books were explained in detail by Shri. Umesh Modi, Broker. 1.2 In addition to above, search was also conducted at the office of M/s. Shri Salasar Ispat Pvt Ltd (M/s. SSIPL) in Mumbai. From the said premises also, certain incriminating documents were recovered, which includes two transaction book records mentioned at Sr. No. 23 and 24 of the panchanama and one cash book record mentioned at Sr. No. 26 of the Panchanama. These books also contain details .....

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were recorded on various dates viz. 18/12/2006, 2/1/2007, 5/1/2007, 6/1/2007, 20/4/2007, 6/5/2008, 7/5/2008, 9/5/2008, 9/6/2008 and 3/7/2008 wherein he confessed the receipt of M.S. Ingots purchased from various manufacturers as recorded in statement for the period from 27/3/2006 to 16/12/2006. The transaction book records indicated the clandestine removal of CTD Bars in addition to M.S. Ingots by various manufacturers, wherein transactions were done through Appellant No. 3. 1.3 Appellant No. 1 .....

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confirmed the demand, interest and penalties. The appellant filed appeal against the said order and first appellate authority after considering in detail various submissions, dismissed the appeals of all the three appellants. Aggrieved by the said order the appellant are before this Tribunal. 2. Ld. Counsel s main contention for the appellant No. 1 is that the demand has been confirmed without any solid, direct evidence available with the Revenue. Revenue has not produced any documents i.e. proc .....

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ounsel for the appellant quoted the following case laws in support of various contention:- (a) J& K Cigarettee Ltd. Vs. Collector of Central Excise[2009(242) ELT 189(Del)[ (b) Sloto Steel Products Pvt. Ltd. Vs. CCE [2012(281) ELT 193(Del)] (c) Basudev Garg Vs. CC [2013(294) ELT 353(Del)] (d) CCE Vs. Parmarth Iron Pvt. Ltd[2010(260)ELT 514 (All.)] (e) Centurian Laboratories Vs. Commissioner of C.Ex. Mumbai[2013(293) ELT689(Tri- Ahmd)] (f) Galaxy Indo Fab. Ltd. Vs. Commissioner of Central Exci .....

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n firm-appellant No. 1 and in various statements they have admitted clearances of the goods clandestinely without payment of duty. It was further submitted that in case of iron and steel product main raw material is scrap. It is well known that Bazari scrap is available and there are no duty paying documents for such scrap and such transactions normally are in cash and therefore there is no question of getting any records relating to movement of such scrap. Moreover final product i.e. TMT/CTD Ba .....

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limited period. Documents recovered provides precise and complete details of goods, name of the customer, quantity, rate, specifications, name of supplier etc. The main appellant have admitted the details in his statement and such statement have not been retracted. Ld. A.R. also submitted that in view of settled legal position of law that what is admitted need not be proved, there was no need for further investigation. As far as appellant no. 3 is concerned it was submitted that some of the stat .....

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t. It is thus very clear that the retraction were based upon legal advise and it was not based upon factual position/inaccuracy. In these circumstances, retraction is of no consequences. It was also submitted that the Hon ble Supreme Court in the case of Commissioner of Central Excise, Mumbai Vs. M/s. Kalvert Foods India Pvt. Lt[2011-TIOL-76-SC-CX] has held that the statements recorded by the Central Excise officers should be relied upon. Hon ble Supreme Court also held that the statement made b .....

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. CCE, [2014(300)ELT119(Tri. Mumbai)] (b) S.M. Steel Ropes Vs. CCE[2014(304) ELT 591(Tri. Mumbai)] (c) Markas Engineering Pvt. Ltd. Vs. CCE [2014(310) ELT. 431(Bom.)] (d) Somani Iron & Steels ltd. Vs. CESTAT [2011(270) ELT 189(All.) (e) Somani Iron & Steels ltd. Vs. Commissioner[2012(277)ELT A26(S.C)] (d) Sanjay Vimalbhai Deora Vs. Cestat [2014(306) ELT 533(Guj.)] Ld. A.R. Submitted that this Tribunal in the case of M/s. Mahajan Steel Rolling Mills Pvt Ltd. Vs. CCE, Ludhiana[2011-TIOL-16 .....

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uty, interest and penalty have been adjudicated on first appellant while second and third appellant only penalty. 4.1 During the argument Ld. Counsel has submitted that the said office of M/s. SSIPL is common office of M/s. SSIPL, M/s. Gautam Enterprises, M/s. Shri Ganesh Parwati Steel and it was submitted that the said books contained the record of all the firms and therefore statement of Shri. Roshanlal Gautam who was proprietor of M/s. Gautam Enterprises should also have been recorded. We do .....

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er manufacturers also who have clandestinely cleared goods and each record contains very very precise details, like name of supplier, quantity, rate, specification etc. Demand of duty is on appellant No 1 and not on appellant No. 3. Appellant No. 1 and 2 have admitted details. We also note that from the statements of Appellant No. 3 viz. Shri. Pravesh Gautam, Director of M/s. SSIPL were recorded and in each of the statement he has confessed the details of Shri. Pravesh Gautam could have explaine .....

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r statement. We note that Appellant No. 3 viz. Shri. Pravesh Gautam sent retraction of statement almost on all the occasions after recording of the statements. However in none of these retraction correct details were enumerated. On the contrary, in subsequent statements he confirms content of the earlier statements. Under these circumstances we see no reasons to give any importance whatsoever to the retraction and we also hold that contents of the statements can be relied upon. 4.3 As held by th .....

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26. Revenue s case is that appellant No. 3 has purchased clandestinely cleared goods (i.e. without payment of duty) by appellant No. 1 and appellant No. 2 is partner of firm-appellant No. 1. Revenue s allegation is based upon the documents recovered from the office of appellant No. 1 itself and explanation of such documents as also confession by appellant No. 3 himself. Under these circumstances, even if statements of appellant No. 2 are completely ignored in the context of penalty on appellant .....

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