Tax Management India. Com
                        Law and Practice: A Digital eBook ...

Category of Documents

TMI - Tax Management India. Com
Case Laws Acts Notifications Circulars Classification Forms Manuals SMS News Articles
Highlights
D. Forum
What's New

Share:      

        Home        
 

TMI Blog

Home List
← Previous Next →

2019 (4) TMI 530

Held that:- Once the issue that the premises was not in possession of Appellant and that the Appellant did not carry out any manufacturing at the said premises has conclusively been decided and accepted by Department, holding the Appellant guilty of clandestine manufacturing and clearing the consignments without payment of duty from Wazirabad premises is ex-facie unsustainable in law. Thus on this short ground alone, Appellant’s Appeal succeeds. - During the course of investigation itself, Appellant had adduced the evidence of procurement of impugned bed nets from job workers in Cuttack and East Midnapore and transportation of goods from there to Delhi. Further, on investigation, it was found that the job workers as well as transporters in their respective statements admitted to have issued the documents i.e bilty/letters evidencing transportation / manufacturing but could not adduce the supporting documents. Learned Commissioner in the impugned order has rejected those documents as afterthought and confirmed the demand holding that as the Appellant in the tender documents declared himself as manufacturer and hence he cannot be allowed to turn around to say that the goods were .....

X X X X X X X

Full Text of the Document

X X X X X X X

he case as emanating from the Order-in-Original dated 29.05.2017 and the Show Cause Notice F. No. NZU/INV/46/2001/Pt.RSI dated 21.07.2004 is that in the year 2000, Hospital Service and Consultancy Corporation India Limited, (HSCC in short), a Government of India undertaking, floated a tender for supply of mosquito nets under National Anti Malaria and Kalazar Control Programme. The Appellant participated in tender proceedings and procured 2 orders one being Order No. HSCC/PUR/NAMP/208 dated 01.03.2000 for supply of 75,000 single bed mosquito nets of size 6 x3 for a value of ₹ 1,52,10,000/- and another order No. HSCC/PUR/20/PR/220 dated 17.10.2000 for supply of 266666 single bed mosquito nets of size 6 x3 for ₹ 4,63,14,550/-. The said tender inter alia prescribed that only manufacturers would be eligible to participate in the tender and Appellant in his Tender Applications duly declared himself to be a manufacturer. 2.2 Later, on the basis of an intelligence, DGCEI obtained the documents pertaining to the said tender from HSCC and issued summons to the Appellant for appearance. Shri Arun Tibrewal, Proprietor of Appellant - R.S. Industries, did not evoke any response, DGCE .....

X X X X X X X

Full Text of the Document

X X X X X X X

Similarly, on inquiry, the job workers accepted that they had stitched mosquio bed nets for labour charges of ₹ 28/- to ₹ 30/- with tapes, thread etc. purchased by them, however on further inquiry they could not furnish any document with regard to purchase of tapes, threads or job work challans for other documents with regard to job charges by them. 2.5 On completion of investigation, DGCEI concluded that Appellant willfully suppressed the facts by not informing the Central Excise Department that they were manufacturing nylon bed nets at Wazirabad, Delhi; did not obtain registration, removed bed nets valued at ₹ 5,91,58,722/- without payment of duty; and contravened the provisions of Central Excise Act, 1944 and Central Excise Rules, 1944/2001. 3.1 We have heard both sides extensively and perused the records with assistance of learned counsel for the Appellant and learned A.R for Revenue. 3.2 At the outset, we observe that on the basis of investigation and search, DGCEI issued two Show Cause Notices viz. (i) Show Cause Notice No. NZU/INV/46/2001/Pt.RSI/0479 dated 06.03.2003 proposing confiscation of goods seized at Wazirabad premises under Panchnama dated 10.09.20 .....

X X X X X X X

Full Text of the Document

X X X X X X X

out to M/s Moon Beverage Ltd. and not to M/s R.S. Industries, the appellant, herein. In view of the fact that R.S. Industries were not carrying on any business activities in the premises, where search conducted by the Central Excise Officers, confiscation of goods is not proper and justified. Since the Appellant is not the owner of the goods as claimed. I am of the view that imposition of penalty under Rule 25 of the Central Excise Rules is not justified. 6 Therefore, I do not find any merits in the impugned order, and thus, the same is set aside and the appeal is allowed in favour of the appellant. 4.1 During the course of hearing on 03.01.2019, learned counsel for Appellant Shri Piyush Kumar, stressing that when this Tribunal s Final Order No. 54022/2015-SM(BR) dated 21.08.2015 has been accepted by the Department, as no further Appeal appeared to have been filed, the finding that the Wazirabad premises was not in possession of Appellant and that the Appellant did not carry out any manufacturing activity at the said place, has become final and binding and the present demand which has been confirmed on presumption that Appellant manufactured bed nets at the said premises and cleare .....

X X X X X X X

Full Text of the Document

X X X X X X X

ch Pharmalabs Limited versus Commissioner of C. Ex., Hyderabad - 2005 (182) ELT 413 (Tri.-Bang.) holding that demand of Central Excise duty cannot be confirmed on the basis of documents prepared/furnished by an Assessee to Bank / Financial Institutions to obtain higher loan showing fictitious figures. C. There is no evidence whatsoever to prove manufacturing activies at the said premises; procurement of raw material; consumption of power; payment of wages; clearance / transportation of manufactured goods. Moreover, it is a fact on record as evident from Panchnama dated 10.09.2002 and the letter dated 12.07.2004 of Mrs Ritu Agarwal / Naresh Agarwal, owners of subject premises that there was no power connection and there was no generator installed at the said premises. Learned Commissioner has confirmed the demand on the ground that there were 40 stitching machines lying at the premises, however without appreciating that there is no evidence available on record to show that any goods were ever manufactured from those machines and that the goods found at the premises during the raid being of 6 x6 size, and steel beds, did not belong to Appellant. D. Learned Commissioner has wrongly re .....

X X X X X X X

Full Text of the Document

X X X X X X X

ng. We thus find force in the argument of learned counsel that once the issue that the premises was not in possession of Appellant and that the Appellant did not carry out any manufacturing at the said premises has conclusively been decided and accepted by Department, holding the Appellant guilty of clandestine manufacturing and clearing the consignments without payment of duty from Wazirabad premises is ex-facie unsustainable in law. Thus on this short ground alone, Appellant s Appeal succeeds. 5.7 In addition, we find that during the course of investigation itself, Appellant had adduced the evidence of procurement of impugned bed nets from job workers in Cuttack and East Midnapore and transportation of goods from there to Delhi. We further find that on investigation, the job workers as well as transporters in their respective statements admitted to have issued the documents i.e bilty/letters evidencing transportation / manufacturing but could not adduce the supporting documents. Learned Commissioner in the impugned order has rejected those documents as afterthought and confirmed the demand holding that as the Appellant in the tender documents declared himself as manufacturer and .....

X X X X X X X

Full Text of the Document

X X X X X X X

ellants in commercial invoices to secure bank loan - Demand set aside. Arch Pharmalabs Ltd. Vs. CCE, Hyderabad-2005(182)ELT 413. The appellants have explained at the earliest that all the commercial invoices and the delivery challans were fictitious documents prepared solely for the purpose of taking enhanced bank loans. The entries made in private diaries cannot be considered as a conclusive evidence for confirming the demands on the allegation of clandestine removal. The Revenue has not established the receipt of inputs or manufacture of goods and removal of the same to the concerned purchases. There is absence of corroborative evidence from the purchases and the receipt of money. The aspect pertaining to the appellants having produced the documents solely for raising higher bank loans appears to be sustainable. The demand is set aside 5.9 Per contra, reiterating the findings of learned Commissioner in para 51 and 52 of the impugned order, that HSCC had invited bids only from manufacturers and that the Appellant in the tender documents clearly declared himself as manufacturer, learned A.R emphasized that the order of learned Commissioner confirming demand being legal and proper, .....

X X X X X X X

Full Text of the Document

X X X X X X X

 

 

← Previous Next →

 

 

|| Home || About us || Feedback || Contact us || Disclaimer || Terms of Use || Privacy Policy || Database || Members || Refer Us ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.
|| Blog || Site Map - Recent || Site Map ||