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M/s Shivani Detergents Pvt. Ltd., Naresh Bagani (Director) , Mahesh Karambelkar Versus C.C.E. Indore

Demand - clandestine removal of goods - confiscation - no case is made out against the Appellant M/s Shivani Detergent and consequently, the demand and penalty against them are not sustainable. I also find that the lower authorities have ordered confiscation of the goods valued at ₹ 1,23,000/-, which were found in excess and imposed redemption fine of ₹ 5,000/-. I find that no evidence is forthcoming from the records, which can show that there was any attempt made by the Appellant fi .....

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h Bagani and Shri Mahesh Karambelkar are also not sustainable. - Appeal allowed - decided in favor of assessee. - Excise Appeal No. E/2284-2285, 2311/2006-Ex [SM] - Final Order No. 54937-54939 /2016 - Dated:- 11-11-2016 - Mr. S. K. Mohanty, Member (Judicial) Mr. Manish Saharan (Advocate) for the Appellant Mr. Dharam Singh (DR) for the Respondent ORDER Per S. K. Mohanty These Appeals are directed against the impugned Order dated 31.03.2006 passed by the Commissioner of Customs & Central E .....

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ant unit is engaged in manufacture of Sargam Brand Detergent powder & Cake. They were issued show cause notice dt. 23.04.2003 alleging clandestine removal of final product by M/s Shivani Detergents. It was alleged that the Appellant has removed consignments to Maharashtra through M/s ARCO Transport without payment of duty. That in certain consignments, where the name of the consignor was mentioned as same , were cleared through M/s ARCO MP Freight Carriers, without payment of duty. That such .....

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buyers were recorded, wherein they stated that they have purchased Sargam Brand Detergent from Shri Mahesh Karmbelkar. The SCN also relied on statement dt. 26.10.2002 of Shri Mahesh Karambelkar and Shri Omprakash Bagani, director of Appellant, which shows that Shri Mahesh Karmbelkar is employee of M/s Shivani Detergents. The SCN also alleged that in subsequent statement dt. 03.04.2003 of Shri Mahesh Karambelkar contending that he has his own business of trading and is not an employee of M/s Shiv .....

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cause notice denying the allegations. They submitted evidences such as, the Income Tax return of Shri Mahesh Karambelkar and ESIC, PF records of M/s Shivani Detergents which show that Shri Mahesh Karambelkar is not an employee of M/s Shivani but is engaged in the business of trading of Detergents. It was submitted that Shri Karambelkar is also purchasing goods from M/s Dolphin Marketing, who is engaged in marketing the goods of the Appellant firm, and selling the same in the state of Maharashtr .....

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by granting benefit of cum-duty value. The Commissioner (Appeals) confirmed the demand on the ground that from the chart containing details of LRs under which the Appellant Unit has allegedly cleared the goods without payment of duty, it is seen that the name of the consignor is mentioned as Same . This Chart contains the details of the Detergent powder and cakes, transported through different LRs, to various parties in Maharashtra. The transporter, in his statement dt. 26.1.02002 has stated th .....

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t the time when there was no sale by M/s Dolphin Marketing, it shows that the goods were cleared clandestinely by the Appellant firm. The Commissioner (Appeals) thus rejected the appeal filed by Appellants. Hence, this present appeal before this Tribunal. 5.1 The Ld. Counsel for the Appellant submits that the only basis for demanding duty from the Appellant is the statement of the transporter M/s ARCO transport, who stated that in case of LRs, where the consignor name was stated as Same , the go .....

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of M/s Dolphin Marketing or when the goods were transported, there was no sale by M/s Dolphin marketing, therefore, the goods transported through M/s ARCO Transport were cleared by the Appellant. The Ld. Counsel submits that such a comparison has no meaning as the goods were sold by the Appellant firm to M/s Dolphin, who in turn, sold goods to Shri Mahesh Karambelkar and other buyers. That the LRs of M/s ARCO cannot be conclusive evidence that whatever goods were transported through M/s ARCO we .....

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when the statements of the Director Shri Naresh Bagani and Shri Mahesh Karambelkar, income tax returns of Shri Mahesh Karambelkar and his affidavit, and the statutory records of the company submitted by the appellant proved that Shri Karmbelkar is not an employee, the demand was confirmed on the basis of LRs of M/s ARCO. He submits that the demand based upon LRs is not sustainable on mere assumption that all the LRs which show transportation of Detergent Powder and Cake, containing the name of C .....

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the transporter being third party, his record and statement cannot be relied upon in isolation. He further submits that none of the buyers of the goods, in their statement has stated that the goods purchased from M/s Karmbelkar was on account of M/s Shivani. 5.2 He submits that the show cause notice is issued with the assumption that M/s Dolphin was not authorized to sell the goods outside Madhya Pradesh, which is absolutely baseless, as there is no evidence or statement of any person to suggest .....

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ounsel submits that it is the main allegation in the show cause notice that the goods transported through M/s ARCO, showing the name of consignor as Same , were goods cleared clandestinely by the Appellant firm, but nowhere any evidence is appearing as to how such goods were cleared from the Appellant s factory at Pithampur and transported to Indore, which is located 30 kms away. That nowhere the bank accounts of Shri Mahesh Karambelkar could be linked to the goods belonging to the Appellant uni .....

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was acting under the instruction of Appellant firm. That when the revenue presumed that the goods are Soap and Detergent, in that case it can be understood that the same belong to M/s Dolphin or any other party also. That there is no investigation that the goods alleged to have been transported through ARCO are more than the clearances or production shown by the Appellant firm. That there is no corroborative evidences of any extra consumption of raw material, excess consumption of electricity, .....

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hough reliance has been placed upon records seized from house of Shri Mahesh karambelkar containing the name of M/s Dolphin, the same have not been considered. Since the papers are stationary of Dolphin, it shows that he was selling goods of M/s Dolphin. That as may be seen from the statement of buyers whose statements were relied upon, Shri Fatehchandani in his statement dt. 25.03.2003, stated that Shri Karambelkar introduced himself to Shri Fatehchandani as a trader of Detergents. That Chandak .....

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how any nexus between Appellant unit and Shri Karmbelkar. No evidence is available with the Department that buyers purchased goods from the Appellant firm without invoices. Whenever the goods were transported by Appellant firm through M/s ARCO Transport, the name of Appellant firm was clearly mentioned on the transport documents. He submits that thus the demand and penalties against the Appellants is not sustainable as no goods were removed without payment of duty. He also submits that the redem .....

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t on the ground that Shri Mahesh Karambelkar is an employee of the Appellant firm M/s Shivani Detergents, and that the proceeds of goods cleared without payment of duty by M/s Shivani were deposited in his accounts. Revenue has also relied upon the statement of transporter that wherever the name of the consignor was mentioned as same in bilities, the goods were of M/s Shivani Detergent. I find that the Appellant firm M/s Shivani Detergents and Shri Mahesh Karambelkar in their replies to show cau .....

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is no linkage between the amount deposited in bank account of Shri Mahesh Karmbelkar with the goods cleared through transporter M/s ARCO. I find that none of the employees/ director of Appellant firm or Shri Mahesh Karambelkar has stated that the said amount is on account of clandestine clearance of goods of the Appellant Unit. It is further found that no records are available to show as to how the goods were cleared from the Pithampur factory of the Appellant unit to M/s ARCO transport, which .....

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