TMI Blog2018 (12) TMI 1575X X X X Extracts X X X X X X X X Extracts X X X X ..... nt. - APPEAL Nos. E/1648-1653/2010-EX[DB] - FINAL ORDER NOs-72939-72944/2018 - Dated:- 27-12-2018 - Mr. Anil G. Shakkarwar, Member (Technical) And Mrs. Rachna Gupta, Member (Judicial) Shri Bipin Garg Ms Stuti Saggi, Advocates for Appellant Shri Pawan Kumar Singh, Supdt (AR), for Respondent ORDER Per: Anil G. Shakkarwar Above stated appeals are arising out of common impugned Order-in-Original No. 06/Commr./LKO/CX/2010 dated 28/02/2010 passed by Commissioner of Central Excise Service Tax, Lucknow, therefore, they are taken together for decision. Through the impugned Order-in-Original, Original Authority has adjudicated two show cause notices dated 07.08.2003 issued by Additional Commissioner and another dated 13.02.2007 issued by Commissioner. M/s Amkap Marketing Pvt. Ltd. is manufacturer-appellant and remaining appeals are filed by individuals on whom personal penalties have been imposed. 2. Brief facts of the case are that the manufacturer-appellants were engaged in the manufacture of Organic Composite Solvents and Thinners and were classifying the final product under Chapter 38 of Central Excise Tariff Act, 1985 and were paying Central Excis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd Division Chief Controller of Explosive Central Circle, Aagra. On the basis of information received by them, Revenue entertained a view that the said traders by name M/s Naman Traders and M/s Kumar Bansal Traders (P) Ltd. did not exists and therefore, it appeared to revenue that manufacturer-appellants did not undertake any trading and the quantum of sale reflected in sales general maintained by manufacturer-appellant for the period from March, 2002 to March 2004 was in respect of sale of clandestinely removed final products. Therefore, through show cause notice dated 13.02.2007 appellants were called upon to show cause as to why Central Excise duty to the tune of ₹ 3,90,51,589/- on sales value of ₹ 12,20,36,215/- should not be demanded and recovered from them. Through the said show cause notice it was proposed to impose personal penalty on Shri N.K. Agarwal and Shri Ambrish Kumar. Above stated both show cause notices were adjudicated on contest through the impugned Order-in-Original. The manufacturer-appellants submitted before the Original Authority that entire duty on two invoice books had been paid along with interest and the delay in payment was due to facility o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; Check post records which prove evidence of goods having passed through the check post outside the state; Transport vouchers like LRs, consignment notes etc. and statement of transporters; Payment to transporters for freight; Transporters records vouching such clandestine removal of goods; Excess consumption of electricity; Flow back funds/cash; In the present case, it was submitted that not even semblance of such evidence has been brought on record even though a huge quantity of 60,98,804 ltrs. of goods have been alleged to have been cleared in a clandestine manner in the guise of trading turnover. The Original Authority did not appreciate the arguments and passed an order which is summarized below:- (i) The classification of OCS was held to be under Chapter heading 2710.11 during the relevant period i.e. during 2001-02, 2002-03 and 2003-04. (ii) Demand of ₹ 3,79,67,279/- was confirmed against M/s Amkap Marketing Pvt. Ltd. under Section 11A(1) along with interest under Section 11AB. (iii) Demand of ₹ 10,61,000/- was confirmed against M/s Amkap Marketing Pvt. Ltd. under Section 11A(1) along with interest under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h Final Order No.71317/2017 dated 03.10.2017 wherein it was held by this Tribunal that the said goods manufactured by manufacturer-appellants were properly classifiable under Chapter 38 and therefore, he submitted that the goods attracted 16% Adv. duty. He contended that demand was raised by applying rate of duty to be 32% whereas the rate of duty is 16%. Therefore, because of the said reasons, the demand gets reduced to half. He has further submitted that the transaction of trading activity was through banking channels and that sales tax assessment orders and balance sheet clearly shows a separate trading activity in addition to manufacturer. He has further submitted that whole case of revenue is based on presumption and there is no evidence of clandestine manufacture and clandestine clearance. Further, he has relied on the Final Order of this Tribunal in the case of M/s Arya Fibres Pvt. Ltd. Vs Commissioner of Central Excise, Ahmedabad-II reported at 2014 (311) ELT 529 (Tri.-Ahmd.). He has further submitted that this Tribunal in the said Final Order in para-40 has very clearly laid down certain fundamental criteria which have to be established by revenue for proving allegations o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of such finished goods outside the factory; (d) instances of sale of such goods to identified parties; (e) receipt of sale proceeds, whether by cheque or by cash, of such goods by the manufacturers or persons authorized by him; (f) use of electricity far in excess of what is necessary for manufacture of goods otherwise manufactured and validly cleared on payment of duty; (g) statements of buyers with some details of illicit manufacture and clearance; (h) proof of actual transportation of goods, cleared without payment of duty; (i) links between the documents recovered during the search and activities being carried on in the factory of production; etc. We note that the manufacturer-appellants have raised various such issues before the Original Authority and in fact there are no evidences in the whole proceedings which satisfied any of the criteria mentioned above. We, therefore, hold that revenue has failed to establish manufacture of goods in respect of which demand was raised. We, further, note that revenue has also failed to establish that the allegations in the show cause notice dated 07.08.2003 are sustainable. 6. We, therefore, set ..... X X X X Extracts X X X X X X X X Extracts X X X X
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