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M/s Kuber Tobacco India Ltd., Chatar Singh Baid, Vikas Malu Dhanpat Singhee Versus CCE, Delhi

2017 (12) TMI 224 - CESTAT NEW DELHI

Clandestine removal - corroborative evidences - retraction of statements on which reliance was placed upon - Held that: - no search was conducted at the business premises of the assessee-Appellants. The Department had not taken into account the consumption of raw material in the appellants’ factory. So, it is very difficult to say that the raw material was supplied by the assessee-Appellants. For want of evidence, all the statements which were recorded, were retracted later - no demand can be ra .....

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d:- 4-12-2017 - Satish Chandra, President And V. Padmanabhan, Member (Technical) For the Petitioner : Ms. Seema Jain, Adv For the Respondent : Sh. S.K. Bansal, DR ORDER Per V. Padmanabhan The present appeals are filed against order-in-original No. 06/D-1/2017 dated 28.02.2017. This is the second round of litigation before the Tribunal. The period in dispute is 26.08.2008 to 31.11.2008. 2. Brief facts of the case are that : On the midnight of 31.10.2008 and 01.11.2008, the department searched the .....

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s, made out a case of clandestine removal against the Appellants and levied penalties on the concerned persons. 3. Being aggrieved, the appellants filed Writ Petition No. 1738/2012 as well as Writ Petition No. 2851/2014 before the Hon ble High Court. At the instance of the High Court, appellant deposited ₹ 1 crore for the release of Shri Vikas Malu (one of the assessee-Appellants). In the meantime, the original authority has passed the order where the demand was confirmed for the period Se .....

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er the direction of the Tribunal, the original authority has issued the summons to six persons out of which five persons appeared and recorded their statements. These five persons are namely; Sh. Rajesh Kumar Dubey, Om Prakash Dubey, Sh. Sandeep Mann, Sh. Manoj Tripathi and Shri Mohal Lal Shukla. Smt Rajbala did not appear. For the remaining persons, no summons were issued. By the impugned order, the Commissioner has demanded the duty and also levied the penalties. Being aggrieved, the present a .....

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. The company used this brand name commercially. She further submits that the poultry farm belongs to Sh. Sandeep Mann who has let out the premises to Sh. Om Prakash Dubey @ ₹ 8000/- p.m. as per the agreement. To this effect, she relied on para 21 and 22 of the impugned order where the statement of Sh. Sandeep Mann has been discussed. Accordingly, he has let out the premises to Sh. Om Prakash Dubey who has regularly paid the rent as per agreement. 6. On the other hand, Sh. S. K. Bansal, ld .....

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owner of the premises in his preliminary statement, has stated that M/s Kuber Tobacco India is the manufacturer of Kanchan brand gutkha with the help of five machines but later, he retracted his statement. 7. Ms. Seema Jain, Ld. Advocate submitted that, Sh. Dhanpat Singhee is Director in M/s Kuber Tobacco India. His statement was recorded on 01.11.2008 where he has admitted the supply of ready made raw material mix. In the original statement, he stated that he was only sending raw material to S .....

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o material to this effect was brought on record. The learned counsel submits that the Director of the company has nothing to do with the said operation. 9. She has also drawn our attention to FIR lodged by the company on 16.10.2008, prior to the search, where it was stated that in the market under the same brand name, spurious/sub standard pan masala and gutkha are available in the market. So, he made a request to the Police to investigate the matter. 10. She further submits that in the instant .....

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oticees in the instant case. Lastly, she submits that the impugned order may kindly be set aside. 11. Regarding penalties, she submits that in the instance case, penalties are levied on Sh. Vikas Malu and Sh. M.C. Malu for the reason that in the brand names of Wiz and Kanchan, gutkha were sold, as per agreement, to M/s Kuber Tobacco India for its commercial use. Both these persons were not actively involved in the manufacturing of Gutkha. They were not having any interest in the appellant compan .....

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It is the submission of ld. AR that Sh. Manoj Tripathi in his statement on 18.01.2017 has also accused Sh. Dhanpat Singhee for the said clandestine manufacturing of the pan masala/gutkha. He also submits that on 06.11.2008 Sh. Sandeep Mann, owner of the Farm House, has lodged a FIR, after the search where it was stated that illegal manufacture of pan masala/gutkha has been done in his premises. He also submits that Sh. Om Prakash Dubey (in para 19 of the impugned order) admitted that three cheq .....

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or the factory at Khera Khurd i.e. Sandeep Poultry Farm, but the same was retracted. Lastly, he justified the impugned order. 14. After hearing both the parties at length and on perusal of record, it appears that all the statements which were recorded, were later retracted by the concerned persons. For example, the statement of Sh. Dhanpat Singhee dated 01.11.2008 was retracted on the very next day i.e. 02.11.2008. Similarly, the statement of Shri Rajesh Kumar Dubey was recorded on 01.11.2008 wh .....

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register produced had the name of Shri Chatter Singh Baid as the Manager. In his statement, he stated that Shri Chatter Singh Baid is visiting only once in a month or two months and he had not drawn any salary. In other words, he has denied the status of Shri Chatter Singh Baid being a Manager. He was not summoned for examination-in-chief which was supposed to be conducted as per the direction of this Tribunal. 16. Statement of Shri Anil Dubey was recorded on 27.11.2008 wherein it was stated th .....

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fter the search. Four more statements were recorded, but the name of the assessee-Appellants was not mentioned by him. In examination-in-chief, he stated that he came to know that goods were of M/s Kuber (assessee-Appellants) on the day of raid, as was told by Shri Sanjay Rana and Shri Manoj Tripathi. 17. Statement of Shri Pradeep Kumar Anchalia, Director, was recorded wherein he has stated that the work in Delhi factory was being looked after by Shri Dhanpat Singhee, but this does not establish .....

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h Kuber (assessee-Appellants). Statement of Shri Vikas Malu was recorded oon 17.03.2009 and 19.03.2009 wherein he admitted that he was owner of Kuber (assessee-Appellants) and ready to discharge duty, but it is alleged that statements were recorded under duress during transit remand which was retracted on 20.03.2009 from jail. 18. Statement of Shri Om Prakash Dubey was recorded on 18.12.2008 wherein it was stated that the seized machines were installed on the direction of Shri Chatter Singh Baid .....

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