M/S. J.S. Forge Ltd vs Commissioner Of Central Excise

[Arising out of Order-In-Appeal No. 9-10 & 11/RPR-II/2014 dated 28/01/2014 passed by Commissioner of Central Excise Customs & Service Tax (Appeals), Raipur]

For approval and signature:

Honble Mr Ashok Jindal, Member (Judicial)

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?

4 Whether Order is to be circulated to the Departmental authorities?

M/s. J.S. Forge Ltd. Appellants

Shri Soumitra Das

Vs.

Commissioner of Central Excise Respondent

Raipur

Appearance:

Shri Manish Saharan, Advocate for the Appellants

Shri G R Singh, AR for the Respondent

CORAM:

Hon'ble Shri Ashok Jindal, Member (Judicial)

Date of Hearing /decision: 1.07.2015

ORDER NO. FO/ 52107-52108 /2015-Ex(SM)

Per Ashok Jindal :

M/s. J.S. Forge Ltd. and Mr. Soumitra Das, director of M/s. J.S. Forge Ltd. have filed appeals No. E/52046/2014 and E/52051/2014 respectively. Both these appeals have been filed against Order-in-Appeal No.09-10 and 11/RPR-II/2014 dated 28.01.2014 which up held the Order-in-Original No. 08/AC/Adj/2013 dated 26.03.2013 with modification in terms of which inter alia demand of Central Excise duty to Rs. 4,29,258/- along with interest and mandatory equal penalty has been confirmed against M/s. J.S. Forge Ltd. but penalty of Rs. 4 lakhs imposed on Mr. Soumitra Das, was reduced to Rs. 1.5 lacs.

2. The facts, briefly stated, are as under:

M/s. J.S. Forge Ltd. (hereinafter referred to as appellants No.1) are engaged in manufacture of M.S. Ingots, Casting, forgings, fabricated items, equipments and equipment items, Storage tanks etc. During a search of M/s. Monu Steels certain documents and records showing suppression of production and clandestine removal of excisable goods by several manufactures including appellants No. 1. M/s. Monu Steels were the commission agent engaged by the appellants for facilitating sale and purchase transactions of Iron & Steel. The incriminating documents like diaries, files, ledger etc. recovered during search from their premises inter alia showed that appellants No. 1 had cleared 154.900 MT of MS Ingots/Sponge Iron, valued at Rs. 26,30,256/- during the period 2006-07 which were not found have been accounted for by the appellants. The director of M/s. Monu Steels admitted that the said un-accounted quantity was cleared by M/s. J.S. Forge Ltd. without payment of duty of Rs. 4,29,258/-.

3. The appellants have contended that there is no evidence found in their premises about such alleged clearance. Mr. Soumitra Das was shown the incriminated documents recovered based on which the allegation was made but he never confessed that the appellants had cleared the goods clandestinely and merely acknowledged to have been shown the said incriminating documents and that in the absence of any such evidence, the demand cannot be confirmed.

4. Ld. DR on the other hand contends that the incriminated documents recovers from M/s. Monu Steel show the clandestine removal.

5. I have considered the submissions. I find that there is no evidences at all which have been recovered from the appellants regarding any alleged clandestine removal. There is also no confessional statement from the appellants in this regard. The entire impugned demand has been confirmed and penalties imposed merely on the basis of incriminated documents recovered from M/s. Monu Steel. In the case of Rutvi Steel & Alloys Vs. Commissioner Central Excise, Rajkot 2009 (243) ELT 154 (Tri. -Ahmd.) the CESTAT held that entries in the diary of a third party are insufficient to sustain clandestine removal. In this case also, there is no evidence on record to confirm the demand except the incriminating documents recovered from M/s. Monu Steels. Therefore, relying on the decision of this Tribunal in the case of Rutvi Steel & Alloys (supra), the allegation of clandestine removal is not sustainable. Consequently, the demand confirmed in the impugned order is set aside and the appeals are allowed with consequential relief. (if any).

(Dictated and pronounced in the open court )

( Ashok Jindal ) Member(Judicial)

ss

2