Custom, Excise & Service Tax Tribunal
M/S Paragon Cables Company vs Cce, Delhi-I on 8 August, 2013
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL,
WEST BLOCK NO.II, R.K. PURAM, NEW DELHI-110066.
DIVISION BENCH
Court No.2
Appeal No. E/311-322 & 324-331/2005-EX.
(All arising out of common Order-in-Original No. 36/2004 dated 29/10/2004 passed by the Commissioner Central Excise, Delhi-I, New Delhi)
Reserved on: 21/03/2013
Pronounced on:08/08/2013
Appeal No. E/311/2005
M/s Paragon Cables Company Appellant
Vs
CCE, DELHI-I Respondent
Appeal No. E/312/2005
Sh. Somnath Nagpal Appellant
Vs
CCE, DELHI-I Respondent
Appeal No. E/313/2005
Sh. D.L. Nagpal Appellant
Vs
CCE, DELHI-I Respondent
Appeal No. E/314/2005
M/s Paracon Cable Company Appellant
Vs
CCE, DELHI-I Respondent
Appeal No. E/315/2005
Sh. Vikas Nagpal Appellant
Vs
CCE, DELHI-I Respondent
Appeal No. E/316/2005
M/s Paragon Enterprises (India) Appellant
Vs
CCE, DELHI-I Respondent
Appeal No. E/317/2005
Sh. Somnath Nagpal Appellant
Vs
CCE, DELHI-I Respondent
Appeal No. E/318/2005
M/s Paragon Power Cables Ltd. Appellant
Vs
CCE, DELHI-I Respondent
Appeal No. E/319/2005
Sh. Sudhir Nagpal Appellant
Vs
CCE, DELHI-I Respondent
Appeal No. E/320/2005
M/s Paragon Cables Corporation Appellant
Vs
CCE, DELHI-I Respondent
Appeal No. E/321/2005
Sh. Sunil Nagpal Appellant
Vs
CCE, DELHI-I Respondent
Appeal No. E/322/2005
Sh. Vipul Nagpal Appellant
Vs
CCE, DELHI-I Respondent
Appeal No. E/324/2005
M/s Rolex Cable Company Appellant
Vs
CCE, DELHI-I Respondent
Appeal No. E/325/2005
Sh. Sudesh Kumar Appellant
Vs
CCE, DELHI-I Respondent
Appeal No. E/326/2005
M/s Janta Cable Company Appellant
Vs
CCE, DELHI-I Respondent
Appeal No. E/327/2005
Sh. Gulshan Kumar Appellant
Vs
CCE, DELHI-I Respondent
Appeal No. E/328/2005
M/s Metal & Metal Electric Pvt. Ltd. Appellant
Vs
CCE, DELHI-I Respondent
Appeal No. E/329/2005
Sh. Kanti Lal Jain Appellant
Vs
CCE, DELHI-I Respondent
Appeal No. E/330/2005
Sh. Gautam Chand Jain Appellant
Vs
CCE, DELHI-I Respondent
Appeal No. E/331/2005
Sh. D.L. Nagpal Appellant
Vs
CCE, DELHI-I Respondent
Present for the Appellant : Shri J.P. Kaushik, Advocate
Present for the Respondent: Shri B.B. Sharma, DR
Coram: Honble Mr.D.N.Panda, Judicial Member
Honble Mr.MANMOHAN SINGH, Technical Member
FINAL ORDER NO. 57283-57302/2013
PER D.N.PANDA :
All the appeals in this batch arose out of common adjudication order dated 29.10.2004 against 2 show cause notices dated 13.8.2002 and 2.5.2003. Both the proceeding being related to common cause, all these 20 appeals having emanated from such cause, those were heard analogous and disposed by this common order for proper appreciation of facts and evidence.
1.2 When Revenue came to know that some manufacturers of wires and cables falling under Chapter heading no.8544.90 of the Schedule to the Central Excise Tariff Act, 1985 were resorting to large scale evasion of Central Excise duty manufactured in different units owned by them or by their job workers, claiming SSI exemptions in respect of such unit to which they were not actually eligible, enquiry was conducted to trace the sources of evasion and parties involved therein, so also to assess loss of Revenue made by these parties and recover the same. It was revealed that these manufacturers have suppressed more than 50% of actual quantity/value of the clearances made by them falsely describing sizes of the wires and cables on the invoices and understating weight of such goods on the Lorry Receipts. It was further revealed that Paragon group of manufacturers of wires and cables resorting to the above practice had evaded Central Excise duty.
1.3 Search operation was conducted to the premises of following concerns on 21.2.2002:
(1) Paragon Cable Co.
(2) Paragon Enterprises (India)
(3) Paragon Power Cable ltd.
(4) Paragon Cable Industries (P) Ltd
(5) Paragon Cable Corporation
(6) Paragon Cable India
(7) Roxy Electricals
(8) Janata Cable Company
(9) Rolex Cable Company
1.4 While making search to the premises of Paragon Cable Co., a partnership of Mrs. Prem Nagpal and Sri S.N. Nagpal at 308/9, Sahahzada Bagh, old Rohtak Raad, Delhi, Sri D.L. Nagpal husband of Mrs. Prem Nagpal who was owning M/s Roxy Electricals at Bhagirath Palace was present during search. He was looking after the business of the Paragon Cable Co. Investigating team found that a person named Gulshan Kumar Grover was running out of the factory. On interception, he revealed that he looked after the shop of Sri D.L. Nagpal known as Roxy Electrical at Bhagirath Palace. Search made to Gulshan Kumar Grover also resulted with recovery of some papers for further scrutiny.
1.5 During search operation in the factory premises of Paragon Cable Co. some keys belonging to the adjoining concerns viz., M/s Janata Cable and M/s Roxy Cable were recovered. Records recovered from Paragon Cable Co., were subjected to scrutiny to verify the contents and nature thereof.
1.6 Search to Paragon Enterprises (India) at D-40, SMA Indl. Area, G.T. Karnal Road, Delhi was made in the presence of Sh. S.N. Nagpal a partner of that unit. Records, documents and papers recovered during search warranted further scrutiny noticing those were incriminating materials. Inventory recorded during search resulted in physical stock of excess raw materials un-accounted for. Samples were also drawn for testing.
1.7 Search to Paragon Power Cable Ltd. was conducted in the presence of Sri Sudhir Nagpal who was director thereof. Inventory of goods resulted in existence of excess stock of 225 metres of finished wire of 4 core 10mm sq. That also resulted with recovery of incriminating records and documents.
1.8 Search to premises of Paragon Cable Industries (P) Ltd. was conducted in the presence of Sri Vipul Nagpal, a director thereof. That resulted in recovery of records, documents and paper of incriminating in nature.
1.9 Search to Paragon Cable Corporation conducted in the presence of Sri Sunil Nagpal, a director thereof resulted in recovery of incriminating documents and records for further scrutiny.
1.10 Search to the premises of Paragon Cable India was conducted in the presence of Sri Vikas Nagpal and sample of goods was drawn and incriminating documents and records were recovered during search.
1.11 During investigation, when name of Roxy Electrical Cable came to notice of the investigation on 21.2.2002 from Gulshan Kumar Grover who was running away from factory of Paragon Cable Co., search to the premises of the dealer viz., M/s Roxy Electrical in Delhi in the presence of D.L. Nagpal, partner of Roxy Electrical was conducted. Branded wires and cables of different specifications valued Rs.3,62,500/- was seized finding to be existing without duty paying documents. Those goods were seized and directed to be released on payment of redemption fine of Rs.1.00 lakh. Proceeding against its partner Sri D.L. Nagpal who is in appeal No. E-313/2005 in Table -2 of this order was also initiated and penalty of Rs. 50,000/- was imposed on him under Rule 209A and 26 of Central Excise Rules, 2001.
1.12 Search to the premises of Janata Cable Company revealed that the said concern was manufacturer of wire and cables of Paragon brand belonging to Paragon Cable Co., being financially supported by the later. M/s Janata Cable Company was not registered under Central Excise Act, 1944 to manufacture the branded goods. Such fact was admitted by assessee during search. Incriminating documents and records were also recovered in the course of search.
1.13 Search to the premises of M/s Rolex Cable Company revealed that it was financially supported by Paragon Cable Co., to manufacture Paragon brand wires and cable without being registered under central Excise Act, 1944. Such branded goods were cleared by that concern and such fact was admitted in the course of search. Added to this, incriminating documents and records were recovered during search operation.
2.1 Investigation was made to the premises of: (1) Metals and metals, (2) Saurashtra Roadways and (3) Prakash Road lines in Chennai on 21.2.2002. It was revealed that Paragon group of companies viz., Paragon Cable Co., Paracon Cable Co., Paragon Enterprises (India), Paragon Power Cable Ltd., Paragon Cable Corporation, Rolex Cable Co., and Roxy Electricals had consigned wires and cables misdeclaring description thereof. Armoured cables were shown as unamoured cables, copper cables were shown as aluminium cables and larger size cables were shown as smaller size cables. Those goods were seized on 31.05.2002, 29.05.2002, 03.07.2002, 31.07.2002 and 01.08.2002. Misdeclaration of quantity and value was found in respect of seized goods. However such goods were provisionally released against bond and bank guarantee as appears from page 39 of OIO. The quantum of mis-declaration and loss caused to Revenue was depicted in Annexure-39 to SCN.
2.2 Seized goods were valued at Rs. 27,74,596/- in adjudication and duty demand of Rs.1,20,463/- was raised against Appellants in sl. No 1 to 5 of Table-1 below followed by levy of equal amount of penalty under Section 11AC of Central Excise Act, 1944, and Rules made thereunder as well as interest against show cause notice dated 13.08.2002
TABLE-1
Sl.
(1)
Appeal No.
(2)
Appellant
(3)
Duty demand on seizure
(4)
Penalty
(5)
Duty demands on past clearances
(6)
Penalty equal amount of duty
(7)
1.
E-311/2005
Paragon Cable Co.
44,612
44,612
2,03,003
2,03,003
2.
E-314/2005
Paracon Cable Co.
21,811
21,811
2,28,902
2,28,902
3.
E-316/2005
Paragon Enterprises India
13,269
13,269
5,43,751
5,43,751
4.
E-318/2005
Paragon power cable Ltd.
29,670
29,670
3,89,738
3,89,738
5.
E-324/2005
Rolex Cable Co.
11,101
11,101
14,14,299
14,14,299
Total
1,20,463
1,20,463
6.
E-320/2005
Paragon Cable Co.
-
-
13,88,808 13,88,808
7. E-326/2005 Janata Cable Co.
-
-
15,58,069 15,58,069
8. E-330/2005 Gautam chand Jain
-
-
-
50,000
9. E-328/2005 Metal & Metal electronic Pvt. Ltd.
10,00,000
-
-
1,00,000 10 E-329/2005 Kantilat Jain
-
-
-
50,000 2.3 On the basis of seizure of goods in Chennai, residential premises of Metal and Metal in Chennai was searched and certain incriminating documents and papers were recovered. Similarly search to the residential premises of Sri Kantilal Jain, Managing Director of Metals & Metal (Electric) Pvt. Ltd. was made on 21.2.2002 and 3.5.2002 and investigation found questionable materials from that concern also. Similarly search to the premises of Sri S.N. Nagpal, Sri D.L. Nagpal was made and that resulted in recovery of materials showing evasion of duty.
2.4 Seizure of goods as above from different premises revealed involvement of Metal & Metal Electric Pvt. Ltd. in Chennai. Redemption fine of Rs.10.00 lakh and penalty of Rs.1,00,000/- was imposed on that concern. Proprietor of metal and Metal and director of Metal and Metal Electric Pvt. Ltd. Sri Gautam Chand Jain was penalised to the tune of Rs.50,000/- being connected with undervalued consigned goods. Penalty of Rs.50,000/- was also imposed on the Managing Director Sri. Kantilal Jain of Metal and Metal Electrical (P) Ltd. Penalties imposed above were under Rule 209A of Central Excise Rules, 1944 and Rule 26 of Central Excise Rules, 2001.
2.5 During search on 21.2.2002 it was also noticed that some of the raw materials i.e. PVC compound and steel wires were in excess in quantity compared to book stock of M/s Paragon Enterprises (India) Delhi. That concern was clandestinely removing excess quantity of wires and cable and clearing the same to its buyers without accounting and without payment Central Excise Duty.
2.6 M/s Janta Cable Co and M/s Rolex Cable Co., were not registered with Central Excise Authority but manufactured and cleared wire & cables of Paragon brand not owned by them and were taking undue benefit of Notification No. 16/97-CE dated 01.04.97 as well as Notification No. 8/98-CE dated 2.6.98 as amended from time to time without payment of duty while not eligible to such benefit. Accordingly M/s Janta Cable Co. and M/s Rolex Cable Co. were liable to pay Central Excise Duty on the Paragon branded goods manufactured and cleared by them as per Annexure 47 of SCN. Their concerned proprietors were also liable to penal action under the Central Excise law.
2.7 Ultimately difference in quantity consigned and value misdeclared resulting out of comparison of invoices and transport documents and description of goods consigned gave rise to duty demand to the extent indicated against each in column (4) & (6) of the Table-1. That also invited equal amount of penalty as exhibited in column (5) & (7) of the said Table.
2.8 Rolex Cable Co. at Sl. No.5 of Table-1 above and Janta Cable Co. Sl. No.7 of Table-1 above having used brand name PARAGON not belonging to them and availed SSI Exemption benefit lost such exemption in adjudication for the period from April, 1998 to February, 2002. They had grievance that they were not manufacturing branded goods during that entire period. Rolex Cable Co. claimed that it manufactured branded goods during the financial year, 2001-02 and Janta Cable Co. claimed that it manufactured branded goods from 1.1.2002 to 29.2.2002. Appellants were of the conception that if at all there arises demand, denying SSI Exemption, duty demand shall be confined to the period of manufacture of branded goods and there should not be any penalty levied.
3.1 On the basis of outcome of investigation and examination of records, documents and papers recovered in the course of search, statements were recorded from various persons in Chennai and Delhi. Revenue proceeded to investigate history of past clearances of goods for the period April 1998 to February 2002 made by the concerns in sl. No. 1 to 7 depicted in Table-1 aforesaid who are in the appeals noted against each.
3.2 When enquiry into the past clearances of different concerns appearing in Table-1 aforesaid revealed that there were difference in weight of the goods in excise invoices and transport documents and following appellants were connected with such practice, they faced charge and penalty as noted against each in Table-2 were imposed as depicted hereunder:
TABLE-2 Sl. No. Exice Appeal No. Appellant Connection/Status with concerns involved in the adjudication proceedings Penalty imposed 1 312/2005 Somanath Nagpal Partner of paragon cable company 50,000 2 313/2005 D.L. Nagpal Partner of paragon cable company 50,000 3 331/2005 D.L. Nagpal Partner of Roxy Electrical 50,000 4 315/2005 Vikash Nagpal Partner of paracon cable co.
50,000 5 317/2005 Somanath Nagpal Director of Paragon enterprises (India) 1,00,000 6 319/2005 Sudhir Nagpal Director or Paragon power cables ltd.
65,000 7 321/2005 Sunil Nagpal Partner of paragon cable corporation 3,00,000 8 322/2005 Vipul Nagpal Partner of paragon cable corporation 3,00,000 9 325/2005 Sudesh Kumar Prop. Of Rolex Cable Company 5,00,000 10 327/2005 Gulshan Kumar Proprietor of Janata Cable Company 5,00,000
4. Summarily the search and investigation result revealed as under:-
(A) M/s Paragon Cable Co. Delhi M/s Paracon Cable Co. Delhi, M/s Paragon Enterprises (India), Delhi, M/s Paragon Cable Corporation, Delhi manufactured and removed excess quantity of Paragon branded wire and cables valued at Rs.12,17,227/-, Rs.14,15,991/-, Rs.33,53,606/- and Rs.84,12,813/- involving Central Excise Duty Rs.2,03,003/-, Rs.2,28,902/-, Rs.5,43,751/- and Rs.13,88,808/- respectively during the period from April 98 to Feb. 02 recording lesser quantity on invoices, than what was actually despatched. When compared with LRs issued by M/s Saurasthra Roadways and M/s Prakash Roadlines against which the goods were transported to their buyers located in Chennai. Sole intent was to evade payment of Central Excise Duty, leviable on those goods.
(ii) M/s Paragon Power Cable Ltd., Delhi manufactured and cleared excess quantity of wire and cables of paragon brand collectively valued at Rs.24,35,860/- involving Central Excise Duty Rs.3,89,738/- during the period from Sep. 2000 to Feb. 2002 was removed these quantities issuing invoices for lesser quantity than what was actually despatched when compared with corresponding LRs issued by M/s Saurasthra Roadways and M/s Prakash Roadlines consigned to the buyers located in Chennai and suppression was done with intent to evade payment of Central Excise Duty leviable on those goods.
(iii) M/s Paracon Cable Co., M/s Paragon Cable Co., M/s Paragon Enterprises (India), M/s Paragon Cable Corporation, and M/s Paragon Power Cable Ltd., contravened the provisions of Rule 9(1), 52A, 53, 54, 173F, 173G, of as the Central Excise Rules, 1944 and Rule 4, 6, 8, 10, 11, & 12 of the Central Excise (No. 2) Rules 2001 read with Section 38A of the Central Excise Act, 1944.
(iv) Wires and cables of paragon brand were manufactured by the group without payment of Central Excise Duty amounting to Rs.2,03,003/-, Rs.2,28,902/-, Rs.5,43,751/- and Rs.13,88,808/- and Rs.3,89,738/- and were cleared clandestinely by M/s Paragon Cable Co., M/s Paracon Cable Co., M/s Paragon Enterprises (India), M/s Paragon Cable Corporation and M/s Paragon Power Cable Ltd., respectively in term of proviso to sub-section (1) of Section 11A of the Central Excise Act, 1944 for which extended period of limitation.
(b) M/s Janta Cable Co., Delhi and M/s Rolex Cable Co., manufactured and cleared wires and cables of paragon brand not owned by them and removed clandestinely under their own invoices without payment duty and without obtaining Central Excise Registration and without following the proper procedure under the Central Excise Law. Goods valued at Rs.94,60997/- and 85,35,272/- respectively involved Central Excise Duty of Rs.15,58,069/- and Rs.14,14,299/- respectively during the period from April 1998 to Feb. 2002 with a sole intent to evade payment of Central Excise Duty. Contravening the provisions of Rule 9(1), 52A,53, 54, 173B, 173C, 173F, 173G and 174 of Central Excise Rules, 1944 and Rules 4, 6, 8, 9, 10, 11 and 12 of the Central Excise (No. 2) Rules 2001 read with Section 38A of Central Excise Act, 1944. Accordingly Central Excise Duty of above amount was recoverable from them invoking extended period of limitation. Proprietor is Shri Sudesh Kumar of the concerns was also appeared to be liable for penal action under Rule 173Q of the Central Excise Rules, 1944 and Rules 25 of Central Excise (No.2) Rules, 2001 read with Section 11 AC and Section 38A of the Central Excise Act, 1944.
(C) Shri Kantilal Jain, Managing Director, of M/s Metals & Metal (Electric) (P) Ltd., Chennai and Shri S. Gouthamchand Jain, of M/s Metals & Metal (Electric) Pvt. Ltd., Chennai as well as Proprietor of M/s Metals & Metal, Chennai, and above company were concerned in depositing keeping, concealing and purchasing of excisable goods which they knew and had reasons to believe were liable fore confiscation under the Central Excise Act and Rules as no Central Excise Duty had been paid on the goods which were received by them in excess than what was recorded in the respective invoices and therefore, rendered themselves liable to penalty under Rule 209A of the Central Excise Rules, 1944 and Rule 26 of Central Excise (No.2) Rules, 2001 read with Section 38A of Central Excise Act, 1944.
(d) Sh. Somnath Nagpal, Smt. Prem Nagpal w/o Shri D.L. Nagpal, Partners in M/s Paragon Cable Co., Sh. Vikas Nagpal, Shri Sunil Nagpal, Shri Vipul Nagpal, Partners in M/s Paracon Cable Co., Sh. Somnath Nagpal, Shri D.L. Nagpal Shri Anil Kumar, Partners of M/s Paragon Enterprises (India), Sh. Sudhir Nagpal, Shri Sunil Nagpal, Directors of M/s Paragon Power Cable Ltd., Shri Sunil Nagpal, Shri Vipul Nagpal, Smt. Sonia Madan, Smt. Vandu Makkad. Partners in M/s Paragon Cable Coporation concerned in selling, manufacturing, removing the excisable goods in excess quantity made such goods liable for confiscation under the Central Excise Act and Rules as no appropriate Central Excise Duty had been paid on such goods dispatched by them. They also made themselves liable to penalty under Rule 209A of the Central Excise Rules, 1944 and Rule 26 of Central Excise (No.2) Rules, 2001 read with Section 38A of Central Excise Act, 1944.
ARGUMENT ON BEHALF OF APPELLANT 5.1 Learned Counsel spearing on behalf of aforesaid appellants Challenged various consequences of adjudication submitting as under:
(1) Duty of Rs.1,20,463 was demanded by the learned Commissioner in respect of seized goods in Chennai overvaluing the same while in case of the goods covered by invoices, he had demanded duty on the differential value. Such approach was arbitrary. Therefore, duty and penalty demand on this count is liable to be set aside on the ground of incorrect calculation.
(2) For goods seized at Chennai and involving duty evasion of Rs.1.2 lakh as determined by the learned Commissioner, he has imposed redemption fine of Rs.10,00,000/- on M/s. Metals & Metal (Elect) Pvt. Ltd. which is unreasonable and disproportionate as well as arbitrary and may be reduced considering the amount of duty involved.
(3) Past clearance were not at all made with misdeclaration of weight for which neither duty nor penalty imposable on the appellant at sl. No. 1 to 7 of Table-1 above.
(4) For goods value of Rs.3,62,500/- seized from M/s. Roxy Electricals, that did not warrant redemption fine of Rs. 1 lakh which was imposed disportionately and arbitrarily. Considering the assessable value and the duty involved, redemption fine may be reduced.
(5) Penalties imposed on persons in Table-2 above was unwarranted as they were not involved in clandestine removal or under valuation. So, also they were not liable to penalty for their no deliberate involvement to cause evasion.
ARGUMENTS OF REVENUE 6.1 Repelling the arguments of the appellants, learned D.R. supporting the adjudication submits that when seizure of goods was made in Chennai and other places, SCN dt. 13/08/2002 was issued and proper adjudication was made and duty was imposed on the basis of market value and no reduction in redemption fine and penalty shall be justified for the reason of deliberate evasion caused. Appellants connected to the seizure of goods in Chennai and Delhi have no right to pray for reduction in redemption fine or penalty nor they can ask cum duty benefit. So also no concession on penalty is permissible because of their plea they do not intend to litigate with the department. When they were caught red-handed, they have come out for leniency. Duty evasion was detected by investigation and deliberate mis-declaration of quantity as well as value was detected which remained undisputed. Accordingly no lenient view may be taken.
6.2 So far as seizure of goods in Delhi is concerned, Revenues submission was that there should not be any concession to Roxy Electricals when seizure of goods value of Rs. 3,62,500/- was made. No reduction in redemption fine should also be allowed to that concern. But appellants submission is that the appellant intends to reduce the litigation for which, redemption fine of Rs. 1 lakh may be reduced if not waived other wise because imposition of such fine was disproportionate to the value of goods seized. Revenue vehemently apposes to such concession prayed.
6.3 In so far as adjudication made in terms of show cause notice dated 2.5.2003 is concerned, on the first count of allegation of quantity difference, learned DR submits that such difference was made deliberately and made to cover up clandestine removal. But learned Counsel submitted that there was arbitrary adjudication made by eye estimate and weight was also estimated baselessly. Revenue vehemently opposed such contention of the appellant submitting that deliberate suppression made by appellants does not at all grant any concession to appellants who had consciously made breach of law and leniency plea of the appellants if permitted to be entertained that shall be an incentive to evaders.
6.4 So far as allegation of use of brand name is concerned Revenue submitted that inquiry revealed use of brand name by Rolex Cable Co. from the day of setting up of their business but not w.e.f. 1.4.2001 and by Janta Cable Co. only from 1.1.2002 as pleaded by them. They were using the brand name. Therefore, in absence of any cogent evidence to the contrary no reduction to the adjudicated demand of duty and penalty should be granted which other wise shall hamper interest of Revenue.
6.5 So far as leniency plea of the appellant in respect of penalties imposed on the Director and Proprietors covered by show cause notice dated 2.5.2003 is concerned, Revenue submitted that they being conduit to cause loss to Revenue, they do not deserve any leniency. Tribunal should not take a view that persons connected to cause evasion were innocent. Therefore, irrespective of their status as Director, Proprietor or partner of the respective concerns, penalty should be levied indiscriminately when they were actively involved in evasion. They were also master minded to cause injury to revenue. Interference to adjudication shall amount to encouragement of evasion and Revenue shall be seriously prejudiced.
6.6 Lastly, it was submitted by Revenue that any concession to evaders shall be bonus to them.
6.7 Prayer of Revenue was that all the appeals may be dismissed in liminie.
TRIBUNALS FINDING & DECISION 7.1 Goods seized from different premises were proved to be supplied by paragon group of companies including Roxy Electrical and Roxy Cable Company. Appellants failed to rule out their role as consignors of misdeclared goods. Goods seized at various places and consignment of past clearances revealed that description of goods differed in quantity, quality, length and nature of goods and composition as well as characteristics thereof and such difference admitted. Value of goods consigned was also suppressed. Various evidence both oral and documentary revealed a planned evasion by appellants. Ld. Authority had no scope to agree with the descriptions in invoices for which he adopted market value in respect of the goods seized at different places and levied appropriate duty. Appellant had no defence against that. Suppliers of the goods having been found to be involved therein were also penalised. So also persons dealing with such goods were penalised for no proof of their innocence.
7.2 Rolex entered into agreement with Paragon Cable Company for manufacture of Paragon brand of cable 1.4.2001 for a consideration of Rs.20,000/-. Similarly M/s Janata Cable Company entered into agreement with Paragon Cable Company for manufacture of Paragon brand on 1.1.2002. There was no proof of manufacture of branded goods from a later date for no evidence adduced except mere pleading. Statements recorded form different persons and evidence on record proved clandestine removal, undervaluation and use of trade mark by paragon group.
7.3 Authorities below have examined every defence advanced by appellants and examined the same in proper perspective. Entire evidence involved in the adjudication were found to be properly evaluated and appreciated. When the appellants failed to establish bonafide and innocence and no involvement in clandestine removal and misdecalration, that could not be ruled out. All the appellants were subjected to scrutiny and adjudication made properly. Therefore, neither the process of adjudication nor the findings made in adjudication can be held to be faulty. Causing of mass scale evasion by appellants was established on record backed by cogent evidence. Therefore adjudication cannot be disturbed.
7.4 Now, the only point that comes for consideration is the quantum of redemption fine imposable on M/s Metal and Metal (Elect.) Pvt. Ltd. and on M/s Roxy Cables. There was duty demand of Rs.1.2 lakhs in respect of seizure of goods in Chennai and M/s Metal and Metal (Elect.) Pvt. Ltd. faced redemption fine of Rs.10 lakhs. Ld. Authority, Authority below did not justify levy of such huge redemption fine without examining any other undue gain other than duty element if nay made by that appellant. Making an overall assessment of the situation, redemption fine in the case of Metal and Metal (Elect.) Pvt. Ltd. is reduced to Rs.2.5 lakhs which shall be twice the duty element looking to the magnitude of evasion and questionable modus operandi followed.
7.5 So far as the imposition of redemption fine of Rs.1.00 lakh on seized goods of Roxy cable is concerned, that was imposed on the value of goods of Rs. 3,62,500/-. Looking to the value of goods and profit margin unduly gained on duty evaded goods, the redemption fine of Rs.1.00 lakhs imposed on the seized goods of this concern is reduced to Rs.70,000/-.
7.6 Various penalties imposed in adjudication does not appear to be exorbitant when gravity of the cases were examined. Those are confirmed. Duty demand made in adjudication remain untouched.
7.7 Accordingly all appeals are dismissed except reducing redemption fine to the extent indicated above.
(Pronounced in the open court on 08/08/2013)
(MANMOHAN SINGH) (D.N. PANDA)
TECHNICAL MEMBER JUDICIAL MEMBER
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