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2017 (3) TMI 999 - AT - Central ExciseClandestine removal - exceeding the limit of SSI exemption benefit under N/N. 8/2000 dated 01/2000 - demand - penalty - Held that - the appellant M/s A.S. Overseas admitted that they were not carrying out any manufacturing activity in their factory. There is a Panchnama drawn to this effect on 09.11.2000 - demand upheld. CENVAT/ MODVAT credit - credit availed without receiving corresponding inputs - Held that - the appellant admitted that were not carrying out any manufacturing activity in their factory - Shri Sandeep Mittal in his statement also accepts that there has not been any other employee, other than partner, Shri Rajesh Goyal in the firm namely M/s A.S. Overseas, Delhi. When there is no employee working for the firm M/s A.S. Overseas, how can there could be any activity of manufacturing conducted by the said firm - demand upheld. Evasion of duty - wrong availment of CENVAT/MODVAT credit - Held that - the appellant admitted that were not carrying out any manufacturing activity in their factory - he knowingly and deliberately indulged in facilitation of evasion of duty and wrong availment of Modvat/Cenvat credit by the appellants, namely, Mittal Overseas and A.S. Overseas. - the penalty imposed by the impugned order on the appellant Shri Sandeep Mittal of ₹ 10, 00,000/- (Rs. Ten lakh) is reduced to ₹ 1,00,000/- (Rs. One lakh only), when the appellant namely M/s Mittal Overseas, New Delhi and M/s A.S. Overseas, where Shri Sandeep Mittal is proprietor and active partner, have been imposed equivalent penalties. Appeal allowed - decided partly in favor of one of the appellant by reducing penalty.
Issues Involved:
1. Clandestine removal of goods by M/s Mittal Overseas (MO). 2. Wrong availment of Modvat/Cenvat credit by M/s A.S. Overseas (ASO). 3. Imposition of penalty on Shri Sandeep Mittal. Detailed Analysis: 1. Clandestine Removal by M/s Mittal Overseas (MO): The Revenue's main charge against M/s Mittal Overseas (MO) is the clandestine removal of goods, resulting in a confirmed liability of Central Excise Duty amounting to ?1,35,42,241/-. The evidence supporting this charge includes: - The statement of Shri Sandeep Kumar Mittal, proprietor of MO. - Entries in loose papers and other records recovered from the residential premises of Shri Manish Mittal and Shri Sandeep Mittal. The Tribunal found that MO had exceeded the SSI exemption limit under Notification 8/2000 dated 01/2000. The Commissioner observed that the goods were manufactured at MO's premises and not as a job work, thus confirming the duty liability on MO. The Tribunal agreed with the Commissioner's findings that MO indulged in clandestine clearances and evaded payment of Central Excise duty. 2. Wrong Availment of Modvat/Cenvat Credit by M/s A.S. Overseas (ASO): The charge against M/s A.S. Overseas (ASO) is the wrongful availment of Modvat/Cenvat credit amounting to ?39,17,367/-. The main evidence includes: - Statements of Shri Sandeep Kumar Mittal, partner of ASO, indicating no provision of electricity, water, and telephone in ASO. - Statements admitting that raw materials purchased in ASO's name were received at MO. - Transporter Shri Kuldeep Singh's statement that there was no loading/transporting of goods from ASO after March 2000. The Tribunal found that ASO was not carrying out any manufacturing activity since April 2000, as corroborated by the Panchnama dated 09.11.2000 and Shri Sandeep Mittal's statements. The Commissioner concluded that ASO wrongly availed Modvat/Cenvat credit during the period April 2000 to October 2000, amounting to ?39,17,366/-. 3. Imposition of Penalty on Shri Sandeep Mittal: Shri Sandeep Mittal, the proprietor of MO and partner in ASO, was adjudged as the mastermind behind the evasion of duty and wrongful availment of Modvat/Cenvat credit. The evidence includes his own statements and Panchnamas drawn on 09.11.2000 and 13.11.2000. The Tribunal agreed with the Commissioner's findings that Shri Sandeep Mittal deliberately facilitated the evasion of duty and wrong availment of credit. However, considering the totality of the facts and circumstances, the penalty imposed on Shri Sandeep Mittal was reduced from ?10,00,000/- to ?1,00,000/-. Conclusion: The Tribunal upheld the impugned order except for the reduction in penalty on Shri Sandeep Mittal. The appeals filed by M/s Mittal Overseas and M/s A.S. Overseas were rejected, while the appeal filed by Shri Sandeep Mittal was partly allowed with a reduced penalty.
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