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2019 (6) TMI 193

..... goods found in possession of the Appellant were manufactured by the said company and even if the Appellant had obtained the goods from somewhere else and not from the company, the duty on the said goods had been received by the Revenue under the compounded levy scheme. In any case, Central Excise duty is required to be paid by the manufacturer and since the Appellant is not the manufacturer of the said goods, duty cannot be recovered from the Appellant. Further, it has been recorded by the Commissioner (Appeals) that there is no evidence on record to show that the Appellant had manufactured the said goods. Department is of the view that the Appellant had gotten the impugned goods manufactured from somewhere else and was operating under the .....

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..... ge and trade of clandestinely removed Pan Masala, Mouth Freshner and Chewing Tobacco, visited the premises of the Appellant on 20.10.2015. During the course of the search, certain goods viz. Rounak Pan Masala (7,35,000 pcs. Valued at ₹ 29,40,000 - K.G. Pan Products, Gorakhpur), Rounak Tobacco (7,35,000 pcs. Valued at ₹ 7,35,000 - K.G. Pan Products, Gorakhpur) and Paawan Gold Mouth Freshner (50,000 pcs. Valued at ₹ 50,000 - Khemka Herbs and Spices, Kanpur) were recovered. The Appellant failed to produce any documentary evidence with respect to the seized goods. In his statement, the Appellant stated that he had purchased the aforementioned goods from K.G. Pan Products Pvt. Ltd., Gorakhpur without any document through a brok .....

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..... d proposed in the Show Cause Notice along with interest. The Adjudicating Authority also ordered confiscation of the seized goods and imposed penalty of ₹ 20,09,489/- on the Appellant under Section 11AC of the Act read with Rule 25 of the Rules. Further, penalty under Rule 26 of the Rules was also imposed. The Commissioner (Appeals) upheld the Adjudication order. Hence, the present appeal. 4. The ld. Advocate appearing on behalf of the Appellant submitted that the Show Cause Notice had been issued on the basis of assumptions and surmises. It was submitted that the Appellant was not the manufacturer of the impugned goods but only a peddler who procured the said goods and sold them in the open market. It was submitted that since the App .....

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..... y case, Central Excise duty is required to be paid by the manufacturer and since the Appellant is not the manufacturer of the said goods, duty cannot be recovered from the Appellant. Further, it has been recorded by the Commissioner (Appeals) that there is no evidence on record to show that the Appellant had manufactured the said goods. 8. However, I find that the case of the Department is that since K.G. Pan Products, Gorakhpur was operating under the Compound Levy Scheme, the Central Excise duty had been paid in advance. Therefore, the question of payment of duty at the time of clearance does not arise. Further, as per the report of DC (Preventive), Kanpur, Khemka Herbs and Spices Pvt. Ltd., Kanpur had not been carrying out manufacturing .....

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