2018 (2) TMI 1012 - AT - Central Excise

Validity of SCN - cross-examination sought of employees who left the organisation - only challenge to the impugned order is by trying to shift the responsibility on two employees, who have later left the organisation - Held that - It is apparent that the show-cause notice is not merely based on the statements. A lot of records have also been recovered from the appellant s premises as well as from M/s.B.G. Shirke Construction Technology Ltd., Pune, and thus simply because of two employees whose statements have been relied upon and, according to the appellants are not traceable and therefore, cross examination cannot be granted is not sufficient to dislodge the impugned order. The appellants are trying to defeat the proceedings by seeking cross examination of the people who were their employees and have now left. They are not traceable by the appellants too. They cannot escape by challenging the valuation of goods where they failed to co-operate and where reasonable opportunity has been given done by the Revenue, to give proper valuation. Appeal dismissed - decided against appellant.

Summary

Issues involved:
Appeal against demand of duty, interest, penalty, and confiscation of goods under Central Excise Act.

Detailed Analysis:

1. Demand of Duty, Interest, and Penalty:
- Appellants engaged in manufacturing steel doors/windows under Chapter sub-heading No.7308.30, 7308.90 & 7204.90 of CETA, 1985.
- Goods seized due to suspicion of clearance without payment of duty.
- Employees admitted to irregularities in clearance without proper procedure/documents or duty payment.
- Show-cause notice issued for duty, interest, penalty under Section 11AC.
- Appellants challenged order, citing need for cross-examination of involved persons and delayed document supply.
- Tribunal found appellants trying to shift blame to untraceable ex-employees, challenging valuation without cooperation during investigation.
- Tribunal upheld Revenue's valuation based on invoices due to appellants' non-cooperation.
- Appeal dismissed due to lack of merit.

2. Imposition of Penalty on Directors:
- Director held liable for penalty under Central Excise Rules for awareness of irregularities.
- Tribunal referred to High Court and Supreme Court decisions to justify penalty imposition.
- Commissioner's findings highlighted deliberate attempts to mislead department and evade duty payment.
- Directors failed to challenge case facts, instead shifting responsibility to untraceable employees.
- Tribunal upheld penalty imposition on directors, dismissing appeals.

The judgment pronounced on 29/12/2017 upheld the demand of duty, interest, and penalty against the appellants, dismissing their appeals due to lack of merit and justifying the penalty imposition on the directors for their involvement in the irregularities.