Custom, Excise & Service Tax Tribunal
Cce, Chandigarh vs M/S. Vinay Traders on 5 December, 2013
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL, WEST BLOCK NO. II, R.K. PURAM, NEW DELHI-110066 COURT NO. II Central Excise Appeal No. 121/2006-EX[DB] [Arising out of Order-in-Original No. 218-219/CE/CHD/2005 dated 08.06.2005 passed by the Commissioner (Appeals), Central Excise, Chandigarh] Date of hearing/decision: 5th December, 2013 CCE, Chandigarh Appellant Versus M/s. Vinay Traders Respondent
Present for the Assessee: Shri Sanjay Jain, A.R. Present for the Revenue: None Coarm: Hon,ble Shri D.N. Panda, Judicial Member Hon,ble Shri Manmohan Singh, Technical Member FINAL ORDER NO._58638/2013_ Per D.N. Panda None present for the respondent. Matter is rolling on Board in Tribunal from 2006. The respondent is one of the beneficiary of the fraud from the 93 parallel invoices issued by Surya Cotspin Ltd. Extensive inquiry by Revenue revealed that this Respondent along with others connived with M/s Surya Cotspin Ltd. to evade duty. Movement of the goods covered by the questioned parallel invoices was proved from the Octroi receipts issued by Municipality and that fact remained un-rebutted except the defence plea that original invoices and original Municipal Octroi receipts were not produced. There was no denial on the entries in Municipality record which showied movement of the goods covered by parallel invoices.
2. Record shows that Surya Cotspin Ltd. clandestinely removed 270030 Kgs. Of cotton yarn valued Rs. 2,41,65,681/- involving duty evasion of Rs. 22,18,207/-. Revenue gathered evidence showing that soon after investigation i.e. after 03.03.2001, M/s Surya Cotspin Ltd. had production of dutiable goods of 5000Kgs as against 3000 Kgs. Produced before investigation. Investigation very successfully brought out modus operandi of Surya Cotspin Ltd., which suppressed production quantity before 03.03.2001 resulting in movement of such goods to the extent of 5750 Kgs. On 21.02.2001 when goods covered by invoice No. 290 & 291 both dated 21.02.2001 were intercepted by Sales Tax authorities of Patiala, full proof case of clandestine removal was established.
4. It is further allegation of Revenue that the Surya Cotspin Ltd. designed fraud scientifically against Revenue issuing parallel invoices destroying originals thereof with the apprehension that those evidences shall cause detriment to its interest and truth shall be unearthed. The Director Shri Madan Lal and Rajesh Kuma Goyal of Suyra Cotspin Ltd. gave evasive reply and retracted their statement. Tendering of false evidence came to record.
5. Revenue alleges that this respondent being one of the beneficiary of clandestinely removed of goods, imposition penalty of Rs. 10,000/- in adjudication on it is justified. But learned Commissioner (Appeals) without examining the gravity of the matter and brushing aside vital evidence on record including statement recorded from various persons exonerated the respondent from penalty. Therefore, Revenue is aggrieved by such exoneration.
6. Heard Revenue and also perused adjudication order dated 24.03.2005. So also, appellate findings recorded was examined.
7. Order of the learned Commissioner (Appeals) did not record any of the above evidence proving scrutiny thereof at his end. He merely relied on the Sales Tax Tribunals order dated 08.11.2003 and also doubting photo copy of the parallel invoices, exonerated the respondent from penalty. His further observation was that 12 firms (one of them is respondent) denied purchase of clandestinely removed goods. He did not look into the production figures before and after investigation. How suddenly the production increased without justification remained unexplained. Preponderance of probability proved clandestine removal when same production facility before and after investigation resulted in unexplained quantity produced. Octroi evidence remained un-rebutted and proved movement of clandestinely manufactured goods. Parallel invoices disclosed the escaped quantity and value of goods as well as identity of the buyer (this respondent is one of them). Seizure of the goods by Sales Tax authorities proved the origin and destination of movement of goods. That also proved questionable modus operandi. Strict proof is essential in criminal proceedings. But the evidence demonstrating probability is enough to draw inference in fiscal proceeding. Decision of one Court does not bind another court created under different statutes. Therefore order of Sales Tax Tribunal does not bind CESTA.
8. The manner how transactions have been made proved oblique motive and connivance of the buyer respondent. The respondent was one of the beneficiary of clandestinely removed goods by manufacturer. Secrecy hides conspiracy and ill design of committer comes to see the light when that is unearthed. An offender voluntarily reveals secrecy rarely. But generally that is demonstrated by governing facts and attendant circumstances of the case. The goods escaping duty from the end of the manufacturer causing evasion is bound to escape in the hands of buyer being unaccounted. If evasion is permitted to perpetuate that shall be bonus to evaders and economy shall be shacked. Therefore, adjudication sustains in so far as levy of penalty on the respondent is concerned for which Revenues appeal is allowed.
9. Registry is directed to keep copy of this order in files of appeal No. E/2566/2005 to 2580/2005 which are expected to be listed before Bench on 24th January, 2014. We direct the Registry to make proper scrutiny of all these connected cases for analogous hearing, so that piecemeal disposal is not made and evaders do not get incentive. Learned DR is also directed to mention about this order when above appeals came up of hearing (Dictated & pronounced in the Open Court) (MANMOHAN SINGH) (D.N. PANDA) TECHNICAL MEMBER JUDICIAL MEMBER RK 3