TMI Blog2016 (4) TMI 623X X X X Extracts X X X X X X X X Extracts X X X X ..... hich were according to the appellant the Annexure C2 documents) giving rise to the demand of ₹ 67,03,159/- is unsustainable. That became admitted fact without controverting. The allegations of investigation and adjudication findings could not be defended. Therefore the demand on that count is to be sustained. It is ordered accordingly. There was no argument at all made by the appellant for M/s. Vijay Aqua on other consequence of adjudication. Therefore that part of adjudication remain untouched by this order. Accordingly those consequences stand confirmed and its appeal is dismissed. It was prayer of the Appellant M/s. Vijay Aqua that the Tribunal may send back the matter to Settlement Commission for their reconsideration. Without any provision in law in this regard, such prayer is dismissed. So far as penalty on Shri Thiagarajan, Managing Director and on Shri S. Nainar, Director of M/s. Vijay Aqua is concerned, there was no evidence led by them to prove their innocence. Investigation result revealed their active and conscious involvement in dealing with unaccounted raw materials and finished goods causing evasion of duty. Both of them colluded to defraud Revenue. Inves ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sonal penalty of ₹ 50,000/- has been imposed on this appellant under Rule 209A of Central Excise Rules, 1944, in terms of adjudication order dated 31.03.2005, making a baseless allegation in para 61.1 of the adjudication order. 1.2 He explained that Shri Natarajan was Managing Director of M/s. Mathuura Polymers Pvt. Ltd., (hereinafter referred to as the Mathura Polymers) which is in appeal No. E/549/2005. That was a job worker of M/s. Vijay Aqua Pipes Pvt. Ltd., (hereinafter referred to as Vijya Aqua) which is in appeal No. E/614/2005. Central Excise Authorities made a search to the premises of M/s.Vijay Aqua on 24/02/99 and found a truck bearing No. TN 72 5238 in their premises with certain goods loaded therein. Search party found connection between M/s. Vijay Aqua and M/s. Mathura Polymers for which, they made a search to the premises of M/s. Mathura Polymer also on the same date. 1.3 During search into the premises of Mathura Polymer, search party found certain materials relating to M/s. Vijay Aqua. They drew a mahazar recording statement u/s 14 of Central Excise Act, 1994 form Shri Rama Rao, of M/s. Mathura Polymers who was authorized person of that concern looking ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uty paying documents for that. While the third consignment was in the process of dispatch that was intercepted by the authorities and the lorry was detained along with the goods. All such facts were recorded in mahazar dated 24.02.99 signed by Shri Govindarajan. 2.2 Ld. Counsel further submitted that Shri S. Nainar (E/613/2005) stated in his statement that the goods were cleared without any duty paying documents by M/s. Mathura Polymers and the contents of the statement of Shri Natarajan recorded on 22.02.99 was agreeable to him. When a specific query about challans and chits was made to Shri Nainar, he clarified that the PVC pipes as described and quantified in the chits bearing identification No. Sl.No. 1 to 10 and Sl. No. 1 to 18 were the goods manufactured by M/s. Mathura Polymers. Such goods were cleared through the vehicle of M/s. Vijay Aqua. The goods so manufactured were by M/s. Mathura Polymers out of the raw materials supplied by M/s. Vijay Aqua. He also categorically stated that the goods sent were not accounted for in the statutory record. They also availed modvat credit without following the central excise procedures and reversal thereof was not made in respect of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncipal owner of the goods was M/s. Vijay Aqua. 2.8 Appellant lastly submitted that the benefit of Notification No. 214/86 dated 25.3.86 and Notification No. 8/98 dated 2/6/98 cannot be denied to the appellant for the reason that under Notification No. 214/86, procedures are to be followed by the principal manufacturer but not by the job worker. So far as the Notification No. 8/98 is concerned that relates to the claim of SSI exemption by the appellant. 3.1 Ld. AR on behalf of Revenue submits that there was specific intelligence with revenue that duty evasion has occurred due to no accounting of goods sent by M/s. Vijay Aqua to M/s. Mathura Polymers for Job working and Job worked goods sent by the later to the former without being accounted by both of them. Search was conducted to the premises of both on 24.2.99 to ascertain the quantum of revenue loss. Ld. adjudicating authority has recorded the history of the case in para-2 at page-2 of the adjudication order demonstrating questionable conduct of both Parties. Revenue found that raw materials were sent by M/s. M/s. Vijay Aqua to M/s. Mathura Polymers for Job working thereon. That was not accounted for by either parties in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Natarajan imputing him to penal consequence of ₹ 50,000/-. 4.1 Above two appellants and Revenue were heard on 13.1.2016. but, the appellants Shri S.Nainar, M/s. Vijay Aqua, R.Thiagarajan, at Sl. No. 3 to 5 of the cause list could not be heard on that date on mention that they shall argue on 20.01.2016 engaging a senior counsel. But record revealed that there were frequent adjournments taken on such plea and other pleas in the past in these cases and the appeals are made 10 years old. In the interest of justice, the appellants were given an opportunity to place their case on 20.01.2016 without default. They were further informed that if they fail on that date, appropriate order shall be passed on merit without issuing further notice. 5.1 On 20.01.2016, the appellants M/s. Vijay Aqua, Sri Nainar and Sri Thiyagarajan remained absent. Therefore they were granted last opportunity of hearing for 22.01.2016. Ld. Counsel Smt. Hema Muralikrishnan, along with Sri L. Muralikrishnan, Advocates, appearing on behalf of M/s. Vijay Aqua, in appeal No.E/614/2005, and Directors Shri S. Nainar in appeal No.E/613/2005 and Shri Thiyagarajan, in Appeal No.E/615/05 of the said company submit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duty on such clearances (incorrect serial number of RG23 part ii) as there was no such debit entry for payment of excise duty on such clearances. * Have cleared the goods without sufficient balance either in their RG23 part II PLA with an intention to evade payment of duty, * Have manufactured and cleared clandestinely finished excisable goods., viz., Rigid PVC pipes to TWAD board divisions located at various places as per the worksheet prepared in annexure-B without payment of appropriate duty due on the said goods and without following any central excise procedures. 6.2 Revenue says that all the annexures C1, C2 and C3 were the outcome of investigation and that was examined independently without any set off of the claim of the appellant that duty paid under Annexure C3 be adjusted against liability arose under Annexure C2. Relying on para 47 of the adjudication order, submission of learned DR was that C3 not being correlated to the demand under C2 there is no question of set off. Relying on para -47 and 51.1, ld. DR says that the appellants having failed before the Settlement Commission were given appropriate hearing by the adjudicating authority. But they avoided ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tain chits without following any of the central excise procedures and without payment of central excise duty, thereby suppressed the above facts from the knowledge of the department with an intention to evade payment of duty and have contravened the provisions of Rule 9 (1), 52 (A), 53, 173G of Central Excise Rules 1944. MPPL are also liable to pay ₹ 5,95,721/- being the duty involved on the clandestine removal of excisable goods under proviso to sub-section (1) of Section 11 A of the Central Excise Act, 1944 read with Rule 9 (2) of the Central Excise Rules 1944. Thereby rendering themselves liable for a penalty equal to the duty amount so not paid under Section 11 AC of the Central Excise Act, 1944, and liable to pay interest under Section 11 AB of the Central Excise Act, 1944, and liable for a penalty under Rule 173 Q of CER 1944; that MPPL are also liable to pay ₹ 26,520/- being the duty involved in the seized goods under Section 11 A (1) of the Central Excise Act, 1944 read with Rule 9 (2) of the Central Excise Rules, 1944. And penalty under Section 11 AC of the Central Excise Act 1944 on the seized goods. C) The show cause notice also proposed confiscation of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e goods found in the truck by the investigation team during interception were manufactured by M/s. Mathura Polymers and that was consigned to M/s. Vijay Aqua. Many incriminating documents recovered from the premises of M/s. Mathura Polymers during search conducted included few chits demonstrating duty evasion by both parties colluding with each other. Physical inventory of goods taken in the premises of Mathura Polymers revealed that there was shortage of 2000 PVC pipes thereat. Shri Ramarao revealed that the shortage was due to dispatch thereof to M/s. Vijay Aqua by the said truck on the same day which was intercepted by investigation on 24.2.1999. 9.3 When Shri V. Natarajan, Managing Director of M/s. Mathura Polymers Pvt. Ltd. was examined on 25.02.1999. He revealed that what that was the statement given by Shri Ramarao was proper. However nothing came out from his statement to impute him to charge although he corroborated that the goods were cleared by M/s. Mathura polymers without payment of duty. 9.4 When aforesaid facts Came to the knowledge of investigation Shri Nainar, Director of M/s. Vijay Aqua was examined to discover truth. He fully agreed with the outcome of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that remained undisputed before Tribunal. Law is well settled that facts admitted need not be proved. 12.1 The appellant M/s. Vijay Aqua went before Settlement Commission to settle its dispute arose out of search proceeding. But its application was rejected. Adjudication was accordingly made on the basis of outcome of search proceeding. Appellants came in appeal before the Tribunal against the adjudication order. 12.2 Although there were several opportunities granted, by Tribunal, M/s. Vijay Aqua did not lay any cogent and credible evidence to prove that the materials contained in File A (which were according to the appellant the Annexure C2 documents) giving rise to the demand of ₹ 67,03,159/- is unsustainable. That became admitted fact without controverting. The allegations of investigation and adjudication findings could not be defended. Therefore the demand on that count is to be sustained. It is ordered accordingly. 13.1 It was the prayer of the appellant M/s. Vijay Aqua Pvt. Ltd that the spurious invoices found from the file marked as file B showing duty deposit of ₹ 30,61,782/- having been deposited to regularize the duty evasion of ₹ 67,03,159 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ials and finished goods causing evasion of duty. Both of them colluded to defraud Revenue. Investigation substantiated its result with full proof leading incriminating evidence against all the appellants which remained uncontroverted. Therefore, penalty imposed on both the appellant is confirmed and their appeals dismissed. 16. So far as duty demand of ₹ 5,95,721/- on M/s.Mathura Polymers is concerned, it is an established fact from the evidence on record that this concern was involved in removal of unaccounted job worked goods to Vijay Aqua and was an abettor to commit fraud against Revenue. Accordingly entire demand of duty of ₹ 5,95,721/- levied on this concern is confirmed having been engaged in manufacture of duty evaded goods. So also the other consequences of law as adjudicated by the adjudication order remain untouched by this order except to the extent hereinafter dealt separately. Interest if any, payable, shall be recovered. 17. So far as imposition of penalty of ₹ 50,000/- (Rupees fifty thousand only) on M/s. Mathura Polymers, under Rule 173Q of Central Excise Rules, 1944 is concerned, that is not desirable to be levied in view of penalty of S ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
