Contact us   Feedback   Annual Subscription   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Extracts
Home List
← Previous Next →

2015 (12) TMI 738 - PUNJAB & HARYANA HIGH COURT

2015 (12) TMI 738 - PUNJAB & HARYANA HIGH COURT - 2016 (332) E.L.T. 80 (P & H) - Duty demand - Clandestine removal of goods - Clubbing of clearances - Held that:- Tribunal failed to appreciate that the proprietors of both the units had not retracted from their statements as well as of their Accountant and Store Incharge made before the search team. Both the respondents had stored the raw material without maintaining any separate record regarding their respective manufacturing of boring machines .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

estine manner. The Commissioner (Appeals) and the Tribunal ought to have relied upon the statements of the proprietors which were not under inducement or threat. - The fact of clandestine removal of goods had not been proved. Mere quoting the statements of the proprietors and some of their employees was not enough. The value of clandestinely removed goods had not been adjudged. - view adopted by the Commissioner (Appeals) and the Tribunal is a plausible view based on appreciation of material on .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

of 2015. 2. CEA No.2 of 2015 has been preferred by the revenue under Section 35G of the Central Excise Act, 1944 (in short, "the 1944 Act") against the order dated 10.8.2007, Annexure A.3 passed by the Commissioner (Appeals) and order dated 10.2.2014, Annexure A.4 passed by the Customs, Central Excise and Services Tax Appellate Tribunal, New Delhi (in short, "the Tribunal") in Appeal No.2916/07, claiming following substantial questions of law:- "i) Whether the Hon'bl .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ances of both the units and ordering recovery of central excise duty as proposed in the show cause notice?" 3. A few facts relevant for the decision of the controversy involved as narrated in CEA No.2 of 2015 may be noticed. On 10.6.2003, the Central Excise Preventive Officers, Ludhiana searched the factory premises of M/s Jagatjit Agro Industries on the strength of search warrants issued by the competent authority. It was found engaged in manufacturing of boring machines falling under sub .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

1 crore and were clearing the dutiable goods without payment of appropriate Central Excise duty without obtaining Central Excise registration as required under section 6 of 1944 Act read with Rule 9 of the Central Excise Rules, 2002 (in short, "the 2002 Rules"). Consequently, show cause notice dated 5.1.2006 was served upon both the respondents proposing Central excise duty demand by clubbing their clearances. The adjudicating authority vide order dated 7.8.2006 confirmed the demand o .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ith the order, the department filed appeal before the Tribunal. Vide order dated 10.2.2014, Annexure A.4, the Tribunal dismissed the appeal holding that units of both the respondents were separate to each other as M/s Saron Mechanical works was working since the year 1994 whereas M/s Jagatjit Agro Industries had started working in the year 2001. Hence the instant appeals by the revenue. 4. We have heard learned counsel for the parties. 5. Learned counsel for the appellant-revenue submitted that .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

telephone, computer, office accountant. They were dependent on each other as they were issuing the sale bills as per their requirement. They had fragmented their sales in order to avail the benefit of SSI exemption fraudulently. The adjudicating authority had rightly clubbed the clearances of both the respondents removed by them in a clandestine manner. The Commissioner (Appeals) and the Tribunal ought to have relied upon the statements of the proprietors which were not under inducement or threa .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

while supporting the impugned orders submitted that there was no justification in clubbing the clearances of both the respondents because the same could be done only when the other unit is dummy. In the present case, both the proprietors were separate manufacturers though they might be sharing certain facilities. Even otherwise, if the value shown in the show cause notice was taken as value of clearance, then also, the same did not exceed SSI benefit of ₹ 1 crore by either of the two resp .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ed goods had not been adjudged. After considering the entire evidence on record, it was noticed by the Commissioner (Appeals) as under:- "The duty from appellant No.1 has been demanded by clubbing the clearances of proprietary unit M/s Saron Mechncial Works (appellant No.2) owned by the father of Shri Jagatjit Singh, Prop. of the appellants No.1 firm. As per facts on record, during the visit on 10.6.2003 by the Central Excise officers to the appellants' units, some slips pads and loose .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

has been based on under mentioned grounds (1) manufacture and sale of 83 boring machines having value of ₹ 66,00,000/- and these slip pads were issued mostly by one Shri Pala Ram and in some cases issuing person not known as detailed in Annexure 1. The date of issue was not mentioned on these slip pads but these have been considered for the year 2002-03. (2) Manufacture and sale of 13 Boring Machines valued ₹ 16,25,000/- issued by Shri Roji Thomas details as per Annexure II. (3) the .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

respectively. In the defense, the appellants have specifically emphasized that the investigation officers had recorded the statement of Shri Roji Thomas who has been shown as writer of loose slips and he had also admitted that these machines noted in slip had been manufactured and the version was subsequently confirmed by the respective proprietor of appellants No.1 and appellant No.2. They have specifically argued that there is absolutely no such statement of writer of slips as mentioned in An .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

otice would reveal that its heading is detailed of slip pads wherein date of issue was not mentioned. Therefore, the head itself suggests that the dates were not mentioned on the slips and had it not been made clear and elaborated by the adjudicating authority that how the department has included the alleged sale shown as sales for the year 2002-03. Further under heading - slips issued by - in this annexure either it has mentioned "not known" or the name Pala Ram has been mentioned. In .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

either to the effect that who has prepared/authored these loose slips or by whom these machines were made, had been brought on record, it is difficult to hod that the said machines were manufactured and removed by the appellants in a clandestine manner. For placing reliance on such records i.e. loose slips it is necessary that at least author of these slips should have been examined and their statements should have been recorded supporting the charge that they have prepared these slips. In respe .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

bove. Further, these annexures are silent about to whom these machines or any of the machine was sold. In respect of annexure 1 and annexure VIII it is also observed in absence of statement of these persons who have allegedly manufactured these machines, no reliance placed on these loose slips which is relevant to issue i.e. no evidence in respect of procurement of inputs with reference to alleged clandestine manufacture/clearances of goods mentioned in these two annexure I and VIII has been bro .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ulating the value of the goods in a particular year. Their contention is that without declaring the unit i.e. M/s Saron Mechncial Works, Bhikhi Road Cheema Mandi as declaring unit, how the clearances of both the units are clubbed. It has been argued by the appellants that the unit is not dummy rather the unit is owned by father of the owner of the unit of appellant No.1 and No.2 have been clubbed. I find even Shri Roji Thomas, whose statements relied upon for including the clearances mentioned o .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

een proved in the impugned order. Mere quoting the statement of the proprietors and some of their employees who have stated that they were in need of financial assistance was not enough. The value of clandestinely removed goods has not been adjudged. This case was of crossing the sale of ₹ 1 crore notice had contested the authority of the slip pads and loose slips which were the basis of arriving at the alleged clandestine removal and duty demand in the show cause notice. But the adjudicat .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version