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2015 (11) TMI 1475 - CESTAT NEW DELHI

2015 (11) TMI 1475 - CESTAT NEW DELHI - TMI - Waiver of pre deposit - Duty demand - Clandestine removal of goods - Shortage of finished goods - Recovery of kachcha parchis - Held that:- The copies of few Kachcha parchis which have been placed on record as well as the photocopies of the same have been reproduced in the impugned order, do show the supply having been made from ‘Saidpur’ indicating that under those Kachcha parchis, the goods mentioned therein have been supplied from the factory prem .....

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ntity mentioned in Kachcha parchis being higher than the quantity mentioned in the invoices, has also not been disputed. Therefore, there is some substance in the Department’s allegation that the Kachcha parchis whose details are given in Annexure A, B & C to the show cause notice pertaine to the clearances made from HRE/HVRI.

Besides this, we also find in respect of some of the entries mentioned under the head stock out in the loose papers/registers recovered from the residential pre .....

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relied upon has not been allowed and as such there appears to be violation of the principles of the natural justice, the order as such cannot be said to be totally unsustainable, and in any case there would be some duty demand against the appellant.

Even though, there appears to be violation of the principles of principles of natural justice, in our view, still there would be some duty demand which ultimately would be confirmed against the assessee, and therefore, to that extent the .....

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Annexure C to the Show cause notice tally with the details of invoices issued by HRE/HVRI except for the difference in the quantity. In view of this, we hold that this is not the case for total and unconditional waiver from the requirement of pre-deposit. - Partial stay granted. - Appeal No. E/51594/2014-EX[DB] & Stay Application No. E/Stay/51884/2014 - STAY ORDER NO. 50859-50871/2015 - Dated:- 16-3-2015 - Mr. Rakesh Kumar, Member (Technical) And Mr.S.K. Mohanty, Member (Judicial) Appeal No. E/ .....

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the Petitioner : Shri.Prabhat Kumar, Advocate For the Respondent : Shri.Pramod Kumar, JCDR ORDER PER: RAKESH KUMAR The facts leading to filing of these appeals and stay applications are, in brief, as under:- 1.1 The main appellant M/s.HVR Industries Pvt. Ltd., 59/20 Saidpur, Sonepat (hereinafter referred to as M/s. HVRI) is a private limited company with Shri Manoj Bansal and Shri Vikram Bansal as Directors. The factory located at Saidpur Industrial Area, Saidpur, District Sonepat, Haryana is .....

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sal. Shri Manoj Bansal, Shri Vikram Bansal and Shri Dinesh Bansal stay in residential premises at D-76, New Multan Nagar, Delhi at different floors. M/s.Indian Steel Corporation (hereinafter referred to as ISC) is a proprietorship concern of Shri Manoj Bansal and it has three manufacturing units in Nangloi, New Delhi and in those units also, the same final product lead ingots and from lead ingot the red lead, litharge, grey oxide etc. are manufactured. On 15.11.2010 the factory premises of HVRI .....

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this appeal. Other than the shortage of finished goods litharge and lead ingots no other irregularity in any incriminating documents were found in the factory premises of HVRI. 1.2 However, from the domestic of the common residential premises of Bansal brothers at D-76, New Multan Nagar, Delhi certain Kachcha Parchis, loose papers, bound registers, stock registers etc. were found which were placed under seizure. Similarly, from the factory premises of ISC certain Kachcha parchis were found, and .....

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of sale, the customers name, quantity in terms of bags and the truck in which the goods were dispatched. Some of such customers are M/s. Ride Energy Control Pvt. Ltd. whose Director is Shri Narender Kumar Sharma; M/s. Tanwar Rajput and Co. whose partner is Shri Ramanand Aggarwal; M/s. Kaveri Power Tech, Baddi (H.P.) whose Proprietor is Shri Rajender Kumar Aggarwal, M/s. Arora Enterprises, M/s.Leekha Chemicals Pvt. Ltd. whose Director is Shri Ravi Leekha, Jagjeet Singh Sahni, Prop. of M/s.J.S. .....

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al premises of Shri Bansal Brothers at D-76, New Multan Nagar, Delhi and from the factory premises of ISC and on enquiry with Bansal brothers and the customers mentioned above, the investigating officers were of the view that during the period from August, 2007 to November, 2010, HVRI and earlier the HRE HVRI had cleared huge quantity of lead products in a clandestine manner without payment of duty. It appeared that the duty evaded during the period from August, 2007 to November 2010 was ₹ .....

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the stock in register maintained at the factory premises of ISC which appeared to be the entries regarding receipt of the consignments of lead product received from the factory premises of HRE/HVRI. 1.4. On the basis of the above investigation, a show cause notice dated 14.11.2011 was issued to HVRI/ HRE for - (a) demand of duty amounting to ₹ 3,30,07,040/- from HRE, Saidpur, Sonepat for the period from August, 2007 to April, 2010 alongwith interest thereon under section 11 AB of Central .....

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ules, 2002 on Shri Vikram Bansal, Shri Manoj Banal, Shri Dinesh Bansal; M/s.Synergy Poly Additive Pvt. Ltd., Baddi and Shri Sant Lal Maggu, Director of M/s. Synergy Poly Additive Pvt. Ltd.; Shri Rajendra Kumar Aggarwal; Prop. of M/s. Kaveri Power Tech, Baddi (H.P.), M/s. Tanwar Rajput and Co. Indreprestha Industrial Area, Kota and its Managing Director, Shri Ramanand Aggarwal; M/s.Leekha Chemicals P. Ltd., Bahadurgarh, Haryana and Shri Ravi Leekha, its Managing Director, M/s.Jagjeet Singh Sahni, .....

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confirmed against HRE / HVRI respectively alongwith interest thereon under section 11AB and besides this penalty of equal amount was imposed on them under section 11AC, and (b) penalty under Rule 26 of the Central Excise Rule, 2002 of ₹ 2.00 Crores each was imposed on Shri Vikram Bansal, Sh. Manoj Bansal and Shri Dinesh Bansal, and penalty of the following amounts was imposed on M/s.Ride Energy Control Pvt. Ltd., Shri Narender Kumar Sharma, Director, M/s.Ride Energy Control Pvt. Ltd.; M/s .....

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/s.Tawar Rajput & Co. - ₹ 50,000/- (e) M/s.Leekha Chemical Pvt. Ltd. - ₹ 1.00 Lakhs (f) Shri Ravi Leekha, Director of M/s.Leekha Chemical Pvt. Ltd. - ₹ 50,000/- (g) Mr.Jagjeet Singh Sahni, Proprietor of M/s. J.S. Saini Sons Energy System - ₹ 50,000/- (h) M/s.Arora Enterprises - ₹ 50,000/- (i) M/s.Kaveri Power Tech - ₹ 50,000/- 1.6. Against the above order of the Commissioner, these appeals have been filed alongwith stay applications. 2. Heard both the side .....

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nesh Bansal reside, that beside, this the duty demand is also based on some in-stock registers and Kachcha parchis recovered from the factory premises of ISC, that while ISC is a private Ltd Company of Shri Manoj Bansal, HVRI is a Pvt. Ltd. Co. with Shri Manoj Bansal and Shri Vikram Bansal as Directors and earlier the factory of HVRI was owned by M/s.HRE which was the Proprietorship concern of Shri Manoj Bansal, that while the duty demand is against HVRI/HRE located in Saidpur Pur Village, Distt .....

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emises of ISC have been presumed to be in respect of the consignments of lead products cleared from the factory premises of HVRI/HRE for which, there is no justification, that in this regard the statements of the customers also do not support the Departments allegation that the Kachcha parchis were in respect of the consignments cleared from the factory premises of HVRI/ HRE, that though the entire duty demand is based on the Kachcha parchis and some loose papers and registers recovered from th .....

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ents allegation that these document pertained to the clearances made from HRE/HVRI, that though the department relies upon the statements of certain customers in support of its allegation that the consignments received by them had originated from HVRI/HRE, the appellants request for Cross-examination of those persons has been rejected by the Commissioner and the Cross-examination have not been allowed, that in view of the provisions of section 9D (2) read with Section 9 D (1) of Central Excise .....

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eriod of dispute which is alleged to have been manufactured and cleared by them without payment of duty, that in this regard the appellant had disclosed the names of the persons from whom the raw-material, that is, lead scrap and lead ingots have been purchased, but no enquiry had been conducted with them, and that in absence of any evidence of unaccounted purchase of raw-material and evidence of unaccounted manufacture, merely on the basis of Kachcha parchis and some other loose papers and docu .....

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clear that there was no abnormal consumption of electricity during the period of dispute. It was, therefore, pleaded that the duty demand against HVRI/HRE merely on the basis of certain documents recovered from the residential premises of Bansal brothers and the factory premises of ISC, which is not supported by any other evidence of unaccounted purchase of raw-material and unaccounted manufacture, would not be sustainable, more so when all the relied upon documents have not been supplied to th .....

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Shri Pramod Kumar, ld. Jt.CDR opposed the stay applications by reiterating the findings of the Commissioner in the impugned order and pleaded that the Departments case against HRE/HVRI is based on - (a) Kachcha parchis and some loose papers, registers etc. seized from the residential premises of Shri Vikram Bansal and Shri Manoj Bansal, and (b) Kachcha parchis and in-registers recovered from factory premises of ISC, that all the Kachcha parchis on the basis of which the duty is being demanded f .....

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goods were dispatched, that in respect of a number of Kachcha parchis, the details mentioned therein match fully with the duty paid invoices issued by HRE/HVRI, which indicates that these Kachcha parchis indicating supplies having been made from saidpur pertain to HRE/HVRI, that for the purpose of quantification of duty demand the Kachcha parchis whose details match with the duty paid invoices issued by HRE/HVRI had not been included, that details of such Kachcha parchis are given in Annexure-B .....

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Delhi some loose papers, and registers had also been found with details of the clearances mentioned therein under the heading stock out, that the details of a number of entries mentioned under the heading stock out match with details of the invoices or Kachcha parchis pertaining to HRE/HVRI and thus, these details are also of the clearances effected from HRE/HVRI, that for the purpose of calculation of duty demand under heading, the entries stock-out in respect of which duty paid invoices on K .....

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ntained details of the material received from Ochandi / Saidpur, that these supplies are also obviously of the lead products cleared from Saidpur factory to ISC Nangloi, and since no invoices had been issued in respect of these clearances, the same have obviously been made without payment of duty, that the details of these clearances are mentioned in Annexure F to the show cause notice, that the duty demand against HRE/HVRI is, therefore, based on concrete evidence on record, that in this regard .....

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y disallowed, and that since the Department s case against HRE/HVRI is based on the documents recovered from the residential as well as factory premises of Shri Manoj Bansal and Vikram Bansal, the appellant cannot be said to have prima-facie case in their favour and, hence, this is not the case for waiver from the requirement of pre-deposit. 5. Shri Prabhat Kumar, Advocate, the ld. Counsel for the appellant, in rejoinder pleaded that though the duty demand against HRE/HVRI has been calculated on .....

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d other documents have not been supplied to the appellant, that according to him only a few Kachcha parchis have remarks indicating the clearance having been made from Saidpur factory and other Kachcha parchis do not have any such remarks and therefore the same cannot be linked to HRE/HVRI, and that since cross-examination of the customer has not been permitted which is mandatory in terms of the provisions of section 9 D (2) read with section 9 D (1) of the Central Excise Act, 1944, no reliance .....

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rused the records. 7. The factory of HVRI, whose Directors are Shri Manoj Bansal and Vikram Bansal is located at Village Saidpur, Distt. Sonepat and earlier this factory was owned by HRE which was a proprietary concern of Shri Manoj Bansa. Indian Steel Corporation (ISC) having factories in Nangloi, New Delhi is a proprietorship concern of Shri Manoj Bansal. The factories of ISC located in Delhi as well as the factory of HRE/HVRI located at Village Saidpur, District Sonepat, Haryana manufactured .....

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Power Tech, Baddi whose Proprietor is Shri Rajender Kumar Agarwal, M/s.Leekha Chemicals Pvt. Ltd. Bahadurgarh, whose Managing Director is Shri Ravi Leekha; M/s. J.S. Sahni Sons Energy System, New Delhi, whose proprietor is Shri Jagjeet Singh Sahni; M/s. Ride Energy Control Pvt. Ltd., whose Director is Shri Narender Kumar Sharma; M/s. Arora Enterprises, Rohtak, Haryana; M/s. Synergy Poly Additive Pvt. Ltd. Baddi, whose Director is Shri Sant Lal Maggu; M/s. Balaji Polymers, Patiala, Shri Iswar Ch .....

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nsal and Shri Vikram Bansal; (c) Kachcha Parchis recovered from the factory premises in Delhi of ISC whose proprietor is Shri Manoj Bansal and (d) in-stock register seized from the factory premises of ISC at Delhi. According to the Department, all the Kachcha parchis mentioned in Annexure A, B, C, and E to the show cause notice have remarks indicating that supplies are from Saidpur. It is also the Departments contention that the details mentioned in these Kachcha parchis are the date of dispatc .....

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ur factory of HRE/HVRI. The other evidence relied upon by the Department is that the statement of the customers who have confirmed the purchase of lead products without invoice from Shri Vikram Bansal and Manoj Bansal. The contention of the appellant, however, is that firstly, though while the department relied upon the statement of the customers, and the specific request for these cross-examination had been made, but the same was not been allowed while cross-examination of the person whose stat .....

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department s contention that these Kachcha parchis have remarks showing that the clearances have been made from Saidpur, cannot be accepted. According to the appellant, only a few Kachcha parchis may be having remarks indicating supply of the goods having been made from Saidpur, but all the Kachcha parchis do not have such remarks, and the same cannot be linked to the factory premises of HRE/HVRI 8. The copies of few Kachcha parchis which have been placed on record as well as the photocopies of .....

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ued by HRE/HVRI. Similarly, the fact that in respect of the Kachcha parchis mentioned in Annexure C to the show cause notice, the details of the parchis tally with the invoices issued by HRE/HVRI except for the quantity mentioned in Kachcha parchis being higher than the quantity mentioned in the invoices, has also not been disputed. Therefore, there is some substance in the Department s allegation that the Kachcha parchis whose details are given in Annexure A, B & C to the show cause notice .....

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all the Kachcha parchis and the documents on the basis of which the duty demand has been quantified have not been supplied to the appellant and the cross-examination of the customers whose statement has been relied upon has not been allowed and as such there appears to be violation of the principles of the natural justice, the order as such cannot be said to be totally unsustainable, and in any case there would be some duty demand against the appellant. 9. While considering the question of waive .....

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