Custom, Excise & Service Tax Tribunal
M/S. Chetak Marmo Pvt. Ltd vs Commissioner Of Central Excise on 1 December, 2014
IN THE CUSTOMS, EXCISE AND SERVICE TAX
APPELLATE TRIBUNAL, NEW DELHI
PRINCIPAL BENCH, COURT NO. III
Excise Appeal No. 52837 of 2014 Excise Stay Application No. 53196 of 2014
[Arising out of Order-In-Appeal No. 221(OPD) CE/JPR-II/2013 dated 31.12.2013 passed by Commissioner of Customs & Central Excise, Jaipur II]
For approval and signature:
Honble Ms. Archana Wadhwa, Member (Judicial)
Honble Mr. Rakesh Kumar, Member (Technical)
1
Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2
Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3
Whether Their Lordships wish to see the fair copy of the Order?
Seen
4
Whether Order is to be circulated to the Departmental authorities?
Yes
M/s. Chetak Marmo Pvt. Ltd. Appellants
Vs.
Commissioner of Central Excise Respondent
ST, Jaipur II Appearance:
Shri Jatin Mahajan, Advocate for the Appellant Shri R K Grover, DR for the Respondent CORAM: Hon'ble Ms. Archana Wadhwa, Member (Judicial) Hon'ble Mr. Rakesh Kumar, Member (Technical) Date of Hearing /Decision : 25.11.2014 ORDER NO . FO/ 54689 /2014-Ex(Br) Per Ms. Archana Wadhwa (for the Bench):
After dispensing with the condition of pre-deposit, we proceed to decide the appeal itself inasmuch as the issue stand decided by the earlier decision of the Tribunal as also of High Court.
2. For better appreciation of the order passed by the Commissioner (Appeals), we reproduce the relevant paragraph as under:
28. I have gone through the case records as well as submissions made at the time of personal hearing. Firstly, it is seen that the issue of depositing duty on shortage of stock of marble of 1008.58 sqm amounting to Rs.31,165/- along with 25% penalty amounting to Rs.7,791/- has not been challenged and made part of this appeal, hence this aspect does not require any discussion. Now, I come to the second aspect of the impugned order. It is seen that the department has made this case on the basis of declaration of cash from undeclared sources for the balance sheet for the year 2008-09 and 2010-11. The appellants have argued that the income was basically income of the Director who had other sources of income. The contention is factually as well as legally incorrect. The duty has been demanded on the miscellaneous income shown in the books of account of the appellant company and not recovered as unaccounted cash at the residence of the Directors. A company is a legal entity distinct from the directors and its income cannot be claimed to be income of the Directors. Moreover, once an income is recorded in the books of an assessee as miscellaneous income and that is accepted as income before the income tax department, the natural presumption would be to relate it with the core activity of the assessee which in this case was manufacture. It was for the appellants to discharge the onus of proving that the income did not relate to their manufacturing activity but they have not discharged this onus. Therefore, I not see any reason to modify the Order-in-Original.
3. As is seen from the above, the finding of clandestine removal and consequent confirmation of demand and imposition of penalties is solely based upon the disclosure of income made by the appellant before the Income Tax Authorities. The appellate authority has observed that such disclosure leads to presumption that such income was generated through illegal activities of manufacture. It is well settled law that clandestine removal has to be established by production of positive evidence. In the absence of any other evidence on record, some disclosure and surrender of income before the Income Tax authorities especially when the appellant had taken a ground that they were also doing other activities for generation of income, cannot held to be sufficient evidence so as to uphold the finding of clandestine activities in the absence of procurement of raw materials, actual manufacture of the goods and non-identity of the transporter and customer etc.
4. In support of the above contention, reference can be made to Punjab & Haryana High Court decision in the case of CCE, Ludhiana vs. Mayfair Resorts [ 2011 (22) STR 263 (P&H)]; CCE, Ludhiana vs. Zoloto Industries [2013 (294) ELT 455 (Tri-Del)]; and Vardhman Chemtech Ltd. vs. CCE, Chandigarh [2013 (298) ELT 546 (Tri-Del)].
5. In view of the above, we set aside the impugned order and allow the appeal with consequential relief to the appellant.
6. Stay petition as also gets disposed of in the above manner. (operative part of the order pronounced in the open court) ( Archana Wadhwa ) Member(Judicial) ( Rakesh Kumar ) ss Member(Technical) ??
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