Custom, Excise & Service Tax Tribunal
M/S New Jain Sales Corporation vs Cce, Delhi I on 4 January, 2013
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL West Block No. 2, R.K. Puram, New Delhi 110 066. Principal Bench, New Delhi COURT NO. IV Excise Appeal No. 1747-1748 of 2012 (SM) [Arising out of the Order-in-Appeal No. 28-29/CE/DLH/2012 dated 11/04/2012 passed by The Commissioner of Central Excise, New Delhi.] For Approval and signature : Honble Shri 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 would 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? 4. Whether order is to be circulated to the : Department Authorities? M/s Jainsons ] M/s New Jain Sales Corporation ] Appellant Versus CCE, Delhi I Respondent
Appearance Shri R. Santhanam, Advocate for the appellant.
Shri R.K. Mathur, Authorized Representative (DR) - for the Respondent.
CORAM : Honble Shri Rakesh Kumar, Member (Technical) DATE OF HEARING : 04/01/2013.
Final Order No. 55182-55183/2013 Dated : 04/01/2013 Per. Rakesh Kumar :-
The facts leading to filing of these two appeals are, in brief, as under.
1.1 M/s Jainsons is a proprietary concern of Shri Mukesh Jain engaged in the manufacture of bath room fittings. M/s New Jain Sales Corporation is a proprietary concern of Shri Sushil Jain, brother of Shri Mukesh Jain, engage in manufacture of kitchen sinks under brand name D Sons. Both these units during the period of dispute were engaged in manufacture of the above-mentioned items without obtaining Central Excise registration and without payment of duty, as according to them their clearances were well within the exemption limit of SSI exemption notification. The units of both the appellants were visited by the Jurisdictional Central Excise officers on 11/12/09. From the factory of M/s Jainsons finished goods valued at Rs. 8,31,760/- and semi-finished goods and raw material valued at Rs. 3,29,656/- and also cash of Rs. 1,50,000/- were recovered. Since it appeared that the appellant had crossed the threshold exemption limit of Rs. 1.5 crore and were required to obtain the central excise registration and had not obtained the registration and hence the finished goods alongwith the cash appeared to be liable for confiscation, the same were placed under seizure. In course of search of factory premise of M/s New Jain Sales Corporation and also their shop the finished goods valued at Rs. 2,83,690/- alongwith the cash of Rs. 1,25,000/- was recovered. These goods and the cash seized from the factory premises of M/s New Jain Sales Corporation and their shop were also placed under seizure. In course of search these premises the computers installed same were also taken over the data stored therein was retrieved. On study of the data retrieved it appeared that both the units had crossed the threshold exemption limit of SSI exemption but still had not obtained registration and were not paying any duty in respect of their clearances. During investigation, Shri Mukesh Jain also in his statement admitted to the duty evasion to the tune of about Rs. 50 lakhs. Accordingly a show cause notice was issued to both the appellants for demand of short paid duty alongwith interest and also for imposition of penalty on them. This show cause notice is pending adjudication before the Commissioner and the same is not the subject matter of these appeals. Beside the show cause notice for duty demand etc. which is pending before the Commissioner, the appellants were also issued another show cause notice for the confiscation of finished goods and also the cash seized from their premises. These show cause notice were adjudicated by the Jurisdictional Deputy Commissioner vide order-in-original dated 12/5/11 by which the Deputy Commissioner holding that during 2009-2010, the appellant had crossed the threshold exemption limit of Rs. 1.5 crore, but still had neither obtained central excise registration and nor had been paying duty in respect of their clearance, held that the finished goods seized from their premises are liable for confiscation. Accordingly, he ordered confiscation of the seized finished goods with option to be redeemed on redemption fine. He, however, ordered release of the semi-finished goods. As regards the cash seized from the premises of M/s Jainsons and M/s New Jain Sales Corporation, he, holding that the same the sale are the processed of goods cleared without payment of duty ordered its confiscation under Section 121 of Customs Act, 1962 as made applicable to Central Excise matter by notification issued under Section 12 of the Central Excise Act, 1944. Beside this, he also imposed penalty under Rule 25 of the Central Excise Rules, 2002, on both Shri Mukesh Jain and Shri Sushil Jain. Both the appellants filed appeals against this order of the Deputy Commissioner before the Commissioner (Appeals). In the appeals before the Commissioner (Appeals), the main grievance of the appellants was regarding the confiscation of cash, which according to them was not liable for confiscation. The Commissioner (Appals), however, vide order-in-appeal dated 11/4/12 held that since the question as to whether the appellant during the period 2009-2010 had crossed the SSI exemption limit is pending adjudication before the Commissioner and is yet to be decided, the adjudication of the question of confiscation of the finished goods and currency by the Deputy Commissioner is pre-mature. Accordingly, the Commissioner (Appeals) by the impugned order set aside the Deputy Commissioners order and directed the Adjudicating Authority to refer the impugned show cause notice to the Commissioner/Competent Authority, for deciding the question of confiscation of the seized goods as well as currency alongwith the main case involving the duty demand, in terms of the Boards Circular No. 328/44/97-CX dated 13/8/97. Against this order of the Commissioner (Appeals), these appeals have been filed by both the appellants.
2. Heard both the sides.
3. Shri R. Santhanam, Advocate, the learned Counsel for the appellants, pleaded that the appeals have been filed by the appellants challenging the Deputy Commissioners order regarding confiscation of the cash, that this issue should have been decided by the Commissioner (Appeals), that the Commissioner (Appeals) had no power of remand and that in view of this, the impugned order is not correct.
4. Shri R.K. Mathur, the learned Departmental Representative, defended the impugned order by reiterating the findings of the Commissioner (Appeals) in the impugned order and pleaded that the order passed by the Deputy Commissioner on the question of confiscation of the seized goods and the currency is pre-mature, as this question is linked with the question as to whether during 2009-2010 period, the clearances of the appellant had crossed the exemption limit of the SSI notification and this issue is pending adjudication before the Commissioner. He, therefore, pleaded that Commissioner (Appeals) had correctly directed to Deputy Commissioner to refer the show cause notice to the Commissioner, who is the Competent Authority for deciding the question of confiscation of the seized goods as well as of currency alongwith the main issue of duty demand against the appellants.
5. I have considered the submissions from both the sides and perused the records.
6. The question of confiscation of the finished goods and currency is linked with the question as to whether the appellants during period of dispute i.e. 2009-2010 had crossed the SSI exemption limit of Rs. 1.5 crore. If they had crossed the SSI exemption limit, they would be required to pay duty on these clearances in excess of the exemption limit and also obtain the central excise registration. But this question is yet to be decided by the Commissioner in another show cause notice with regard to the duty demand from both the appellants, which had been separately issued. In view of this, I hold that the Deputy Commissioners order is pre-mature. In fact the Deputy Commissioner should have either waited for the Commissioner to decide the matter or should have referred the show cause notice, in question, to the Commissioner to be adjudicated alongwith the main show cause notice. I, therefore, do not find any infirmity in the impugned order. The same is upheld. The appeals stand disposed of, as above.
(Pronounced in the open court.) (Rakesh Kumar) Member (Technical) PK ??
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