Subscription   Feedback   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Articles Highlights TMI Notes SMS News Newsletters Calendar Imp. Links Database Experts Contact us More....
Extracts
Home List
← Previous Next →

Kay Pan Sugandh Pvt. Ltd. Versus Commissioner of Central Excise Customs & Service Tax, Rourkela

Clandestine manufacture and removal - annual capacity of production - on 10.9.2011 a search was conducted by the Officers of Central Preventive Unit, Bhubaneswar-II acting on some alleged information that the petitioner was also manufacturing and clearing “Gutkha” of MRP ₹ 5/- per pouch under the brand name “Safal”, which was not declared by petitioner - natural justice - Held that: - the main edifice of the case of the department rests on the statements of Mr. Tapan Chandra Dey and Soumen .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

tkha” of MRP of ₹ 5/- from the petitioner Unit, in the fitness of things the authorities should have allowed cross-examination of the above two persons to test the veracity of their statements. By not doing so, in our considered view there has been violation of principles of natural justice. - While filing the interim show cause under Annexure-25, the petitioner has wanted to cross-examine Mr. Tapan Chandra Dey and Soumendra Kumar Sahoo before filing their final reply. Since the same .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

appeal. Taking a cue from that, this Court has no hesitation in quashing the impugned order under Annexure-1, which, this Court hereby does. Further, this Court remands the matter back to the opposite party directing him to give opportunity to the petitioner to cross-examine Mr. Tapan Chandra Dey and Soumendra Kumar Sahoo vis-à-vis their statements and conclude the entire proceeding within three months in accordance with law. - Writ application allowed. - W. P. (C) No. 9628 of 2016 - Dated:- .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

e Central Excise Department and is engaged in manufacture of Pan Masala containing Tobacco commonly known as Gutkha with retail sale prices of ₹ 1, ₹ 1.50 and ₹ 2/- per pouch with effect from 7.4.2010. The case of the petitioner is that it is clearing the above noted goods under the brand name Safal , which is owned by M/s. Kamlakant and Company, Kanpur. The owner has given the right to use the said brand to different companies across the Country as per agreements under which t .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

Act has notified Pan Masala Packing Machines (Capacity Determination and Collection of Duty) Rules, 2008, for short, the Rules . The said rule was amended during 2010. As per the Rules , the factor relevant to the production of notified goods which is Gutkha in the present case shall be the number of packing machines in the factory of manufacturer. According to the petitioner, the said Rules also indicate the number of pouches deemed to be produced per operating/packing machine per month. Furth .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ay be, shall after making such enquiry as required including physical verification, approve the declaration and determine and pass order concerning the annual capacity of production of the factory in accordance with the Rules . In case the manufacturer wishes to make subsequent changes, it is required to file fresh declaration at least three working days in advance to the authorities. In tune with the above requirement, the petitioner filed the requisite declaration in Form-I during the relevant .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ing the relevant period. On receipt of such declaration, after making the required enquiry, the Deputy Commissioner of Central Excise passed orders determining the annual capacity of production of the petitioner s factory for the relevant period. Further, according to the learned Senior Counsel appearing for the petitioner almost every month during the relevant period a number of Officers from the Central Excise Department visited the factory premises and none found any discrepancy relating to t .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ajee Charan Biswal, Shop No.36, Unit-I Market, Bhubaneswar. From these two dealers Safal brand Gutkha pouches bearing MRP ₹ 5/- were seized. Mr. Jagabandhu Chell in his statement recorded under Section-14 of the Act stated that he had received the seized pouches from M/s. Jagannath Enterprise of Seeraj Bhawan, Bhati Road, Rourkela. Mr. Tapan Chandra Dey, Proprietor M/s. Jagannath Enterprise in turn stated that he has received these pouches from the petitioner. 4. Shri Babajee Charan Biswal .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

old of some advertisements in print and electronic media relating to advertisement of Safal Gutkha pouch of MRP of ₹ 5/- indicating involvement of the petitioner. After the completion of investigation, the department issued a show cause notice dated 18.9.2012 under Annexure-20 series. The petitioner vide letter dated 25.12.2012 (Annexure-21) requested the opposite party for supply of certain documents and more particularly the photo copy of the outer packet which contained Safal Gutkha pou .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

cked. When the above noted outer packet was not supplied to the petitioner, the petitioner reiterated its prayer on 3.12.2013 vide Annexure-24. Ultimately, in absence of the photo copy of the outer packet containing pouches, the petitioner submitted its interim reply on 12.12.2013 vide Annexure-25 praying for vacating the show cause notice under Annexure-25 after highlighting the following points. 6. In the interim reply, the petitioner made it clear that during course of search, there was no se .....

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 the petitioner to manufacture Gutkha pouches of MRP ₹ 5/-. Further no documents, diary, note book, computer print out showing manufacture and clearance of Safal brand Gutkha of MRP ₹ 5/- were seized by the officers of the department. It also took the plea that no employee, factory worker of the petitioner made any statement to the effect that the petitioner was engaged in manufacture of Gutkha of MRP ₹ 5/-. The petitioner also disputed the statements made by Tapan Chandra D .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

r. Besides the petitioner one such company was/is M/s. Kay Pan Masala Pvt. Ltd., Ghaziabad. There the petitioner invited the attention of the authorities to a letter dated 12.9.2011 written by M/s. Kay Pan Masala Pvt. Ltd. to the Assistant Commissioner, Division-V, Central Excise, Ghaziabad informing him that M/s. Kanodia Technoplast Ltd., was the manufacturer of laminated products used by it and in the month of April, 2011 it had sent for lamination meant for manufacture of its newly launched p .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

., Ghaziabad was still left with 237 Kgs. of said wrongly printed pouches. With regard to print media advertisement, the petitioner took the stand that the said advertisement was never released by the petitioner. With regard to advertisement in electronic media, the petitioner took the stand that since M/s. Kay Pan Masala Pvt. Ltd., Ghaziabad started marketing of Safal brand Gutkha of MRP ₹ 5/-, the petitioner also thought that it could also manufacture and market Safal brand Gutkha of MRP .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

copy of the outer packet. According to it such outer packet contained the name and address of manufacture to be M/s. Kay Pan Masala Pvt. Ltd., Ghaziabad and not that of the petitioner. Accordingly, on 29.1.2016 the petitioner filed its written submission reiterating his stand that there existed no evidence to establish manufacture of Safal brand of Gutkha of MRP ₹ 5/- by the petitioner as Safal brand Gutkha pouch of MRP ₹ 5/- was never found from the factory premises. Further, no pou .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

27. 8. However, according to the learned Senior Counsel for the petitioner, without meeting the points raised by the petitioner under Annexures-25 and 27 and without allowing the cross-examination of Tapan Chandra Dey and Soumendra Kumar Sahoo, the impugned order under Annexure-1 has been passed confirming the demand of Central Excise duty of ₹ 237,92,85,000/-. Further, the opposite party has directed for recovery of interest at an appropriate rate on the above demanded amount with penalty .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ment/revenue. Though, he pointed out very many facts relating to non seizure of Gutkha pouch of MRP ₹ 5/- from the factory premises, non seizure of machines with capacity to manufacture of Gutkha pouch of MRP ₹ 5/- from the factory premises and non seizure of any document whatsoever from the factory premises showing manufacture and clearance of Safal brand Gutkha of MRP ₹ 5/- during search and that mere advertisement cannot imply manufacture of the disputed goods; however, he m .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

background, he prayed that the impugned order be quashed and the opposite party be directed to give an opportunity to cross-examine the above noted two persons before passing order afresh. In this context, he relied on a decision of the Supreme Court in the case of Andaman Timber Industries -vrs- Commissioner of C. Ex., Kolkata-II, reported in 2015 (324) E.L.T. 641 (S.C.). 9. Per contra, Mr.Choudhury Satyajit Misra, learned Senior Standing Counsel appearing on behalf of the department defended .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

cross-examination was made by the petitioner therein at the earliest possible instance as has been done in the present case while filing the interim reply under Annexure-25. According to him, in that case such a plea was taken at a much belated stage. Therefore, according to Mr. A.Hidayatullah, learned Senior Counsel that case has no application to the facts of the present case. Secondly, he submitted that though Kanungo and Co. (Supra) has been published in 1983, however, the Supreme Court 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

/- of Safal brand Gutkha was seized nor any machinery with capacity to manufacture of Safal brand Gutkha pouch of MRP ₹ 5/- was seized and that there was no seizure of any document/diary/note book/computer printout showing manufacture and clearance of Safal brand Gutkha of MRP of ₹ 5/- from the petitioner Unit, in the fitness of things the authorities should have allowed cross-examination of the above two persons to test the veracity of their statements. By not doing so, in our consi .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

acts and circumstances of the case, there the Supreme Court rejected the plea of the petitioner praying for cross-examination. But here as would appear while filing the interim show cause under Annexure-25, the petitioner has wanted to cross-examine Mr. Tapan Chandra Dey and Soumendra Kumar Sahoo before filing their final reply. Since the same was not acceded to, in our considered view, the entire decision making process has been vitiated. This is because in case during cross-examination the pet .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

nesses, whom Andaman Timber Industries (supra) wanted to cross-examine, formed the basis of impugned show cause. After discussing the facts of the case, the Supreme Court held as follows:- xxx xxx xxx 6. According to us, not allowing the assessee to crossexamine the witnesses by the Adjudicating Authority though the statements of those witnesses were made the basis of the impugned order is a serious flaw which makes the order nullity inasmuch as it amounted to violation of principles of natural .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

what is new what is new
  ↓     bird's eye view     ↓  


|| 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