M/S.Noble Moulds Pvt. Ltd vs Cce, Delhi-I

[Arising out of Order-in-Appeal No.115/CE/DLH/2012 dated 31.12.2012 passed by the Commissioner (Appeals), Central Excise & Service Tax, New Delhi]

For approval and signature:

HONBLE MR. S.K. MOHANTY, 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.Noble Moulds Pvt. Ltd. Appellant

Vs.

CCE, Delhi-I  Respondent

Present for the Appellant :Shri S.C. Kamra &

Shri G.K.Mahajan, Advocates

Present for the Respondent: Mrs. Kanu Verma Kumar, D.R.

Coram: HONBLE MR. S.K. MOHANTY, MEMBER (JUDICIAL)

Date of Hearing/Decision: 01.10.2015

FINAL ORDER NO. 54008/2015

PER: S.K. MOHANTY

This appeal is directed against the impugned order dated 31.12.2012 passed by the Commissioner (Appeals), Central Excise, New Delhi, upholding penalty of Rs.2.00 Lakhs imposed in the adjudication order.

2. Shri S.C. Kamra, the ld. Advocate appearing for the appellant submits that the ingredients contained in clause (a) and (b) of sub-rule (1) of Rule 173Q, are relevant for the finished excisable goods manufactured by the assessee and not related to removal of irregularly availed modvat goods. Thus, according to the ld. Advocate, invocation of the said provision for imposition of penalty is not proper and justified.

3. Per-contra, Mrs. Kanu Verma Kumar, the ld. DR appearing for the respondent submits that plastic granules on which modvat credit taken by the appellant had been removed clandestinely from the factory without maintaining proper records. She further submits that since the appellant had suo-moto deposited the duty alongwith interest, the allegation of clandestine removal of inputs is proved and that mere mention of wrong rule in the S.C.N. will not vitiate the stand of Revenue for non-imposition of penalty. To substantiate her above stand, ld. DR relies on the judgment of Honble Supreme Court in the case of Commissioner of Customs vs. Candid Enterprises reported in 2001 (130) ELT 404 (SC), wherein the principle decided is that fraud nullifies everything. In this context, she further relies on the decision of Tribunal in the case of SGB Engineering Pvt. Ltd. vs. Commissioner of Central Excise, Delhi reported in 2006 (201) ELT 277 (Tri. Del.).

4. Heard both sides and examined the case record.

5. It is an admitted fact on record that the appellant had not maintained statutory records to demonstrate that the goods have been received from the job worker for carrying out necessary activities in the factory of manufacture of the final product. Thus, voluntary payment of duty alongwith interest, without contesting the liability proves the malafides of the appellant that the goods had been clandestinely removed. Hence, in my opinion, the appellant is exposed to the penal consequences provided in the statute. Mere, wrong mention of appropriate sub-rule in the show cause notice or in the original order cannot be to the advantage of appellant for getting undue benefit, which is not otherwise available to him. Therefore, considering the overall facts and circumstances of the case, I am of the view that the ends of justice will be met, if the quantum of penalty is reduced. Therefore, the impugned order is modified to the extent of reducing the penalty to Rs.1,50,000/. The appeal is disposed of in the above terms.

(Dictated and pronounced in the open Court)

(S.K. MOHANTY)

MEMBER (JUDICIAL)

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