2019 (11) TMI 414 - HC - Central Excise

Permission for withdrawal of appeal - monetary limits - SSI exemption - dummy firm - cross-examination of persons - no documentary evidence of purchase from a legitimate source - non-examination of statement of a person, Late Sh.Ashok Kumar, Assistant Manager of Truck Union of Samana, who is dead - seizure of excess stock - HELD THAT - It is averred in the application that Central Board of Indirect Taxes and Customs has issued instruction dated 22.8.2019 and revised the monetary limits for filing appeal before this Court to ₹ 1.00 Crore and the said instructions are applicable to pending appeal. It is further averred that office of Commissioner of Central Goods and Service Tax, Mohali has sent instruction to the effect that personal penalty involved in the appeal being ₹ 80, 23, 000/- is below prescribed threshold limit and as such prayer for withdrawal of the appeal. Appeal dismissed as withdrawn.

Summary

Issues:
- Appeal under Section 35G of the Central Excise Act, 1944 assailing the order passed by CESTAT
- Substantial questions of law raised in the appeal
- Allegations of clandestine clearances by the respondent Company
- Imposition of duty demand and penalty by the Adjudicating Authority
- Appeal filed by the respondent Company before CESTAT
- Final order of CESTAT setting aside the Order-in-Original and allowing the appeal
- Application seeking permission to withdraw the appeal based on revised monetary limits for filing appeals

Analysis:
- The appeal was filed under Section 35G of the Central Excise Act, 1944, challenging the order passed by CESTAT where the appeal filed by the respondent Company was allowed, and the Order-in-Original passed by the Adjudicating Authority was set aside. The substantial questions of law raised in the appeal included the sustainability of the final order in the eyes of the law, the issue of perversity in the impugned order, and the correctness of various findings related to the alleged clandestine clearances by the respondent Company.

- The respondent Company was accused of engaging in clandestine clearances of manufactured goods under the cover of bills of another trading firm to suppress the value of excisable goods, aiming to stay below the exemption limit specified in the small scale exemption notification. Following a search on the premises of the respondent Company, duty demand and a penalty were imposed by the Adjudicating Authority, leading to the filing of an appeal before CESTAT by the respondent Company.

- After a series of litigations, the CESTAT, in its final order, set aside the Order-in-Original and allowed the appeal, providing consequential relief to the respondent Company. However, an application was filed seeking permission to withdraw the appeal based on revised monetary limits for filing appeals, where it was argued that the personal penalty involved in the appeal was below the prescribed threshold limit, leading to the dismissal of the appeal as withdrawn.

- The judgment highlighted various legal intricacies surrounding the allegations of clandestine clearances, the procedural aspects of appeal filings, and the implications of revised monetary limits on ongoing litigations. The detailed analysis of the substantial questions of law and the application for withdrawal provided a comprehensive overview of the legal proceedings and the final outcome of the case.