Custom, Excise & Service Tax Tribunal
M/S Sks Ispat And Power Limited vs Cce &St, Raipur on 24 February, 2014
CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL West Block No.2, R. K. Puram, New Delhi. Court No. 1 Date of hearing/decision: 24.02.2014 For Approval and Signature: Honble Mr. Justice G. Raghuram, President Honble Mr. Rakesh Kumar, Technical Member 1 Whether Press Reporter may be allowed to see the Order for publication as per Rule 26 of the CESTAT (Procedure) Rules, 1982? 2 Whether it should be released under Rule 26 of 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? 4 Whether Order is to be circulated to the Departmental authorities? Excise Appeal Nos. 58671 to 58674 of 2013 with Excise Stay Nos. 59298 to 59301 of 2013 (Arising out of order-in-Original No. Commissioner/ RPR/CEX/ 51/2013 dated 30.03.2013 passed by the Commissioner of Central Excise, Raipur). M/s SKS Ispat and Power Limited Appellant Deepak Gupta T. Rama Rao R.M.S. Tomar Vs. CCE &ST, Raipur Respondent
Appearance:
Sh.S. Jai Kumar, Advocate for the appellant Shri Pramod Kumar, Jt. CDR for the Respondent Coram: Honble Mr. Justice G. Raghuram, President Honble Mr. Rakesh Kumar, Technical Member Final Order Nos.50753 50756/2014 Per: Justice G. Raghuram:
At the stage of considering the applications seeking stay of further proceedings for realisation of the assessed liability, pursuant to the adjudication order dated 30.03.2013 passed by the Commissioner, Raipur, we consider that in the facts and circumstances the matter should be remitted for adjudication de novo. We therefore waive pre-deposit and dispose of the appeals; after hearing the learned Counsel for the appellant and ld. Jt. CDR for the respondent.
2. The impugned order confirms Central Excise duty demand of Rs.8,88,61,118/- apart from penalty of an equivalent amount, under Section 11A of the Central Excise Act, 1944 and interest under Section 11AB apart from penalties of Rs.2,50,00,000/-; Rs.1,00,00,000/- and Rs. 1,00,00,00/- imposed on Shri Deepak Gupta, Jt. Managing Director, Shri R.M.S. Tomar, President (Works) and Sh. T. Rama Rao, Assistant General Manager (Tax) and the authorised signatory of the principal appellant/company.
3. The principal appellant M/s SKS Ispat & Power Ltd, Raipur is a manufacturer of Sponge Iron, Blooms/ Billets, Rolled Products of Iron & Steel and Ferro Alloys. Pursuing an intelligence input indicating suppression of production and evasion of duty, simultaneous search operations were conducted by departmental officers during 06.05.2008 to 09.05.2008 at the factory premises and at the residence of the Joint Managing Director, Shri Deepak Gupta. During the search, physical stock verification of finished goods was carried out in the presence of the company officials; statements were recorded of certain officers and several incriminating documents are also said to have been recovered. A cash of Rs.59,58,800/- were also recovered from the residence of the Joint Managing Director. This amount was seized on the assumption that it represented the value derived from excisable goods clandestinely removed. Computer data was also seized alongwith the CPUs/CDs/DVDs and associated software and files during the process of search.
4. Eventually, a show cause notice dated 27.10.2008 was issued calling upon the appellants to submit responses. Since 14.02.2012 the appellant had been specifically requesting for supply of the relevant material seized and retrieved from the CPUs/CDs/DVDs. The request on 24.02.2014 was reiterated on 19.01.2012. In response to the show cause notice dated 27.10.2008, submitted on 22.02.2012 the appellant specifically reiterated the request for furnishing of the data retrieved from the CPUs/DVDs/CDs.
5. It is undisputed that the data was eventually furnished, only on 08.03.2013. The appellant on 17.03.2013 sought further time for submitting its considered response on analysis of the data furnished from the CPUs/ DVDs/CDs (on 08-03-2013), on the ground that the data comprises over 10 lakh files and nearly 21,000 folders; that for analyses of the furnished data and response thereto six months time be granted.
6. Without ruling on the request for further time, the respondent passed the adjudication order dated 30.03.2013, confirming the demand of duty, interest and penalties.
7. The adjudication order copiously draws on information derived from the computer data for the conclusion that 11,288 MTS of sponge iron produced by the principal appellant company was suppressed and the corresponding duty evaded. On the basis of the loading register maintained by factory personnel, the order identifies an undeclared clearance of 233 MT of sponge iron apart from specified quantities of MS billets and rolled products.
8. Learned Counsel for the appellant contends, and we are persuaded that this contention merits consideration, that the actual production of sponge iron; M.S. billets; blooms; rolled products such as channels, angles, beams etc. could be accurately identified only on an integrated analysis of information retrieved from the computer data with the facts inferred from the records maintained by the loading personnel and invoices generated at the weighing station. Such process of an integrated analysis is frustrated by the failure in providing to the appellant a reasonable opportunity, to submit a considering response to the information emerging from the computer data, on account of inadequate time offered for such response, in the facts of the case around twenty days is the time lag between the date the data was furnished and the date of the impugned adjudication order.
9. Learned Counsel for the appellant also states that there are a large number of discrepant entries, discrepancies which are apparent from analyses of the records maintained by the loading personal, involving multiple entries of same transactions; and that these discrepancies could be pointed during the process of adjudication. Learned Counsel submits that if the matter is remanded to the primary authority for de novo adjudication, the appellant may be afforded an opportunity to point out to the adjudicating authority such discrepancies as well. Learned Counsel further states that since the information was furnished from the computer data nearly an year ago, i.e. on 08.03.2013, a short time of not more than three months be afforded to the appellant to submit its response to the computer data furnished. We consider it appropriate and fair that period of three months from today should be afforded. We also consider it appropriate to record that no further time should be allowed to the appellant, as the appellant had sufficient time and opportunity for analysis the computer data furnished on 08.03.2013; and that on any further time if sought by the appellant would amount to a protractive strategy which would be unreasonable.
10. On the aforesaid analysis we set aside the impugned adjudication order No. Commissioner/ RPR/CEX/ 51/2013 dated 30.03.2013 dated 30.03.2013 passed by the Commissioner, Raipur. The issue is remanded to the respondent for denovo adjudication. The appellant shall furnish its response including on the computer data furnished on 08.03.2013 and the alleged discrepancies in analysis of the data/ records derived from the loading department of the appellant company; and any other submissions that the appellant may deem fit to include in its response; which shall be submitted within a period, not exceeding three months from today. After this period the respondent shall consider the entire material on record including the response if any submitted by the appellant in terms of this order; and if no such response is submitted the respondent is at liberty to proceed to adjudication on the basis of the material already on record. Needless to mention that the respondent is required to record its analysis, reasons and conclusions on the material on record and the basis for identifying any liability of the appellant to Duty, interest and penalty.
11. The appeals are disposed of as above. There shall be no order as to costs.
(Justice G. Raghuram) President (Rakesh Kumar) Technical Member Pant 6