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TMI Blog2015 (12) TMI 1638X X X X Extracts X X X X X X X X Extracts X X X X ..... hich attract nil rate of duty. On 6-6-2007, a search was conducted in the premises of M/s. Kunal, residential premises of director and CEO and other concerned official along with raw material suppliers/buyers. During the course of search, certain documents were seized, 3 samples were drawn from M/s. Kunal, 10 samples were drawn from different buyers. On the basis of statements and report of samples drawn, a conclusion was drawn by the Revenue that the appellant is engaged in the activity of manufacturing precipitated calcium carbonate which attracts duty and the same has been cleared by the appellant in the guise of calcium carbonate which attracts nil rate of duty thereby evading payment of duty. Consequently, the show cause notice was issued to the appellant to demand duty on account of clandestine removal of precipitated calcium carbonate and to impose redemption fine on the goods seized. In the show cause notice, it was also proposed to impose penalty on all the appellants. The adjudication took place. It was found that the M/s. Kunal cleared precipitated calcium carbonate clandestinely thereby evading payment of duty. Accordingly, the impugned order was passed demanding duty i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te with low oil absorption. The sample under reference is having less density than natural calcium carbonate. On the basis of analytical findings as above it may be considered as precipitated calcium carbonate. 4. The adjudicating authority considered that the goods manufactured by the appellant are precipitated calcium carbonate. The said report is not conclusive as it relating to activated calcium carbonate was never asked for by the DGCEI, The sample sent for re-testing after issuance of show cause notice without knowledge and concurrence of appellant and that too, to the same laboratory i.e. CRCL, New Delhi, the opinion cannot be relied on for adjudication of the case. He further submitted that neither any expert opinion nor any evidence brought on records that the appellant cleared precipitated calcium carbonate only. Therefore, without any evidence, the demand is not sustainable against the appellant when the appellant has not availed the credit on raw materials and working under Notification No. 8/2003 availing SSI exemption and also manufacturing different types of lime stone powder, quick lime powder, calcite which are not chargeable to duty. Therefore, impugned ord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rd to the demand, Rs. 1,03,69,193/-, the demand has been confirmed on account of clandestine clearance of calcium carbonate on the basis of ledger of Shri Vinod Khullar having account of Shri Varun Khullar and others. It is submitted that the samples were drawn on 6-6-2007 from Shri Varun Khullar - partner of M/s. Mahavir Chemicals, Delhi and test report says that the samples do not conform specification of precipitated calcium carbonate and nothing has been brought on record that the appellant has cleared precipitated calcium carbonate to Vinod Khullar/Varun Khullar and others. 10. Regarding the demand of Rs. 45,21,421/-, which has been confirmed on the basis of documents/notebook recovered from Mukul Kumar, Lab Assistant. Shri Mukul Kumar was maintaining diary for different products and therefore, it cannot be stated that it was only for precipitated calcium carbonate and there is no corroborative evidence to support that charge. 11. Regarding the demand of Rs. 9,58,622, which has been confirmed on the basis of blank GR's recovered from premises of M/s. Satnam Transport Co. The quantity and commodity @ 12 MT of calcium carbonate per GR has been arbitrarily taken as GR ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in the activity of clandestine manufacture and clearance of precipitated calcium carbonate in the guise of lime stone powder, calcite, quick lime which are exempted from duty and the same has been confirmed by CRCL in their report dated 29-5-2008 as the drawn of samples has not been disputed by the appellant. Therefore, the said report is admissible evidence to hold against the appellant. In view above, the adjudicating authority has rightly held that the appellant was engaged in the activity of clandestine manufacture and clearance of precipitated calcium carbonate in the guise of lime stone powder, calcite, quick lime to evade payment of duty. 16. Heard both sides and considered the submissions. 17. We have heard both sides in detail and also verified the records placed before us. On the basis of records placed before us, we find that the demands have been confirmed against the appellant on the following grounds :- Sr. No. Component of demand Amount (1) (2) (3) 1. Duty on account of clandestine clearances on the basis of checkpost details of Punjab Border Rs. 2,50,70,800/- 2. Duty on account of clandestine clearances on the basis of Ledgers No. 20/1 & 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... On the basis of analytical finding as above samples do not conform to the specification of precipitated calcium carbonate as per IS : 8767-1978. Sealed remnant returned. 19. The said report clearly shows that the samples drawn do not conform to the specification of precipitated calcium carbonate as per IS : 8767-1978. On the said report, no finding has been given by the chemical examiner with regard to classification but clearly stated that these are the samples drawn are not of precipitated calcium carbonate. As it is fact on record, the appellant is manufacturer of lime stone, quick lime powder, calcite which are chargeable to nil rate of duty under CTH 2521 00 90. 2522 10 00 and 2530 90 30 respectively. In that circumstance, without any corroborative evidence, it cannot be alleged against the appellant that the appellant is only manufacturing precipitated calcium carbonate. 20. We have also seen the demand has been confirmed on the appellant under different heads as discussed hereinabove as per table above, each head is dealt as under :- (i) Duty on account of clandestine clearance on the basis of check post details of Punjab Border - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ses of M/s. Satnam Transport are blank GR's. GR does not describe the quantity and description of the goods, the demand cannot be confirmed on the basis of assumption and presumption. As no corroborative evidence has been produced on record, therefore, the demand of Rs. 9,58,622/- is set aside. (v) The demand of Rs. 1,06,41,860/-, the said demand has been confirmed on account of undervaluation by considering the goods cleared as precipitated calcium carbonate - We have seen that it is alleged that the appellant has not declared the true value of the goods on the charge that the goods were precipitated calcium carbonate which is having higher value whereas in the description of goods by the appellant has shown as quick lime, lime powder, lime stone powder and calcite powder which are having less value. As discussed above, there is no concrete evidence to show that as the clearance made by the appellant is precipitated calcium carbonate, therefore, the charge of undervaluation is not sustainable. Consequently, the demand is set aside. (vi) The demand of Rs. 78,26,500/-, We have seen that the appellant is manufacturing quick lime, lime powder, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... all these records taken into consideration, it cannot be alleged that the seized goods were not entered in the RG-1 regiser. Therefore, the said charge is not sustainable and the demand on this account is set aside. 22. We further find that the raw material i.e. lime stone 40000 MT, pet coke 1000 MT and charcoal 1000 MT were also seized. The said quantity has been arbitrarily taken by eye estimation and no verification report/chart prepared and it is not possible to verify the said huge quantity of raw material in a single day. Therefore, the raw material and finished goods cannot be seized. In that circumstance, the allegation of non-accountal of goods in the statutory record is not sustainable. 23. In view of above observations, We hold that the demands confirmed against the appellant i.e. M/s. Kunal is not sustainable that the seized goods are also not liable for confiscation, consequently, redemption fine and penalty are not imposable on M/s. Kunal and penalties on various other co-appellants are not imposable. 24. In result, the impugned order lacks merits, hence set aside. Consequently, the appeals are allowed with consequential relief, if any. (Pronounced ..... X X X X Extracts X X X X X X X X Extracts X X X X
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