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Jayalakshmi Printing Mills, N.R. Nachimuthu, Partner Versus Commissioner of Central Excise

2016 (10) TMI 29 - CESTAT CHENNAI

Clandestine removal of goods - Demand raised unjustly - processed fabrics dispatched in the name of M/s/Jayalakshmi Printing Mills were entered in the Central Excise Record on payment of duty, the processed fabrics dispatched in the name of M/s/Bharath Printing Mills - material facts and evidence not examined - Held that:- the order of the Adjudicating Commissioner shows that he has not applied his mind when he writes "without going too much into the identity of M/s.Jayalakshmi Printing Mills, E .....

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proximity between the two. But, he suddenly came to the conclusion that he has no difficulty to hold that M/s. Jayalakshmi Printing Mills was engaged in illicit manufacture of processed fabrics in the premises of M/s.Bharath Printing Mills and removed that without payment of duty also. He has brushed aside the documents gathered by investigation and failed to test evidentiary value thereof. - It was the duty of the Adjudicating Authority to ascertain whether there were two distinct and indep .....

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th Printing Mills directly and through M/s.Senthilandavar Calendering Mills and M/s.Sri Devi Felt Calender without accounting the transactions in the statutory records and without payment of Central Excise duty. But all such facts were not tested. - Therefore, the manner in which the impugned order has been passed, that calls for direction to the Adjudicating Authority to redo the adjudication examining the controversy in the SCN and considering the material facts, evidence, law and previous .....

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adhu Mohan Damodhar, Technical Member Shri G. Natarajan, Advocate For the Appellant Shri S. Govindarajan, AC (AR) For the Respondent ORDER Per D.N. Panda On the basis of investigation into the premises of M/s.Sri Jayalakshmi Printing Mills on 27.11.92 and result of investigation, the search party made allegation of loss of Revenue of ₹ 16,09,897/- towards duty. Summary of allegations was as under :- "i) M/s.JPM and M/s.Bharath Printing Mills are one and the same located at 130- A/SF N .....

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dispatched in the name of M/s/Bharath Printing Mills were without payment of duty voucher or Central Excise gate passes to the business premises at 34, T.V.S. Street, Erode directly and through the calendaring mills. iii) The printing mill was declared and got registered as M/s/Jayalakshmi Printing Mills for Central Excise purposes and for other department it was declared and got registered as M/s/Bharath Printing Mills in order to suppress quantum of production, cleared and with intention to e .....

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of 12/91. From the perusal of the file, it may be seen that the production particulars of processed fabrics are higher than the processed fabrics found in M/s.Senthil Andavar Calendering Mills records. The District Supply Officer along with his letter dt. 8.2.93 enclosed the particulars submitted by M/s.Bharath Printing Mills signed by Shri N.R. Nachimuthu, as a partner, these particulars are dated 26.12.92 (i.e. after the date of officers). In this, the production particulars from 1/92 to 12/92 .....

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articulars appear to have been furnished to the District Supply Officer, Erode to the end of December'91 but subsequently lesser quantities for the period from January'91 to December'92 has been furnished on 26.12.92. It therefore appeared that they declared lesser quantities of production in order to pay lesser Central Excise duty in the name of Sri Jayalakshmi Printing Mills and they declared actual quantities of production to other departments to get the benefit of higher allotmen .....

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6,06,897.08 for the period from 5/88 to 27.11.92 should not be demanded under Rules 9(2) of Central Excise Rules, 1944 read with proviso to Section 11A of Central Excise Act, 1944. iii) A penalty should not be imposed on them under Rules 9 (2), 52A, 173Q and 226 of Central Excise Rules, 1944." 2. On the above allegations, adjudications were made twice on remand by Tribunal's Final Order No.1465 and 1466/2000 dt. 19.10.2000 and Final Order No.1148 and 1149/2002 dt.11.10.2002. Present im .....

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he has not applied his mind when he writes in para-18 "without going too much into the identity of M/s.Jayalakshmi Printing Mills, Erode and M/s.Bharath Printing Mills, Erode he shall try to evaluate whether the quantities of processed fabrics specified in the show cause notice were manufactured and removed without payment of duty or not", that demonstrates that he had prejudged mind to reach to his decision without testing the evidence on record. While the SCN exhibits that there were .....

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firms and there was proximity between the two. But, he suddenly came to the conclusion that he has no difficulty to hold that M/s. Jayalakshmi Printing Mills was engaged in illicit manufacture of processed fabrics in the premises of M/s.Bharath Printing Mills and removed that without payment of duty also. In para-32 of the impugned order, he has brushed aside the documents gathered by investigation and failed to test evidentiary value thereof. 7. On the above circumstance, it was the duty of th .....

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