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TMI Blog2009 (11) TMI 375X X X X Extracts X X X X X X X X Extracts X X X X ..... xcise (No. 2) Rules, 2001/Central Excise Rules, 2002. Penalty of Rs. 5,00,000/- u/r 173Q of Central Excise Rules, 1944 and u/r 25 Central Excise Rules, 2002 was imposed on Shri Sama Rajasekhar, MD, HRPL. Penalty of Rs. 25,000/- each was imposed on S/ Shri M. Kalyana Chakravarty and Siva Durga Prasad, Accountant, HRPL u/r 209A of Central Excise Rules. 1944 and Rules 26 and 27 of Central Excise (No. 2) Rules, 2001. Penalty of Rs. 500000/- was imposed on Smt. S. Varalaxmi, Proprietrix, Priya Chemicals. Transporters involved were also imposed with penalties. The present appeals and stay petitions have been filed by HRPL and others excluding the transporters. 2. The appellants have challenged the impugned order mainly on the ground of violation of principles of natural justice. In the appeal as well as during hearing, the appellants submitted that the impugned order had been passed without affording adequate opportunity to them to present their case. The allegations against the appellants were found based on several documents which had not been furnished to the appellants despite their persistent requests. The appellants had requested for supply of relied upon documents and return of u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rejected. 4. We have carefully studied the case records and the rival submissions by both sides. During investigation, statements were recorded from MD and employees of HRPL, buyers of resins and transporters. Relying on the evidence gathered, the Commissioner found after due process of law, that HRPL cleared excisable goods namely, resins, manufactured by it using bills/invoices of other firms viz. M/s. Kalyan Chemicals, M/s. Prasad Chemicals and M/s. Priya Chemicals describing the resins falsely as Orthoxylene, Mineral Turpentine Oil etc. M/s. Kalyan Chemicals, M/s. Prasad Chemicals and M/s. Priya Chemicals were non-existent. The Commissioner concluded that the appellants had arranged clearance and sale of its resins under bills/invoices of M/s. Kalyan Chemicals, M/s. Prasad Chemicals and M/s. Priya Chemicals and realized much higher amounts than those shown on the respective bills/invoices. This was in order to remain within the SSI exemption limit and to evade payment of excise duty due. The excise duty so evaded by the appellants was found to be to the tune of Rs. 67,47,513/-. 5. We find that in the impugned order, the Commissioner found as follows :- "90. Shri Ch. Venkate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the case. Therefore, I feel that their version of defence is fully presented and heard in more than half a dozen PH opportunities." 6. The Commissioner has not discussed the various statements recorded during investigation which led her to the findings arrived at in the impugned order. She has given the following as the summary of the evidence gathered from the several statements :- "92. Though the above said customers bought resins from HRPL, they used to get bills in the names of Kalyan Chemicals and others (viz. Prasad Chemicals, Priya Chemicals, etc.). They used to place orders for resin with the representative of HRPL (viz. Sri. Srinivas Mahesh/Sri. Ch. V. Durga Prasad). But, the description of the goods was written as Orthoxylene/MTO and the price of the goods was shown between Rs. 10- Rs. 20 per kg. However, payments were made as per the rates prevailing in the market at that time, such as, Rs. 48 to Rs. 51 per kg. The billed price was paid through bank by cheque/draft in Global Trust Bank, Kilpauk, Chennai to account numbers 2901101248/2901101142 in the name of Shri Kalyan Chakravarthy and the differential amount was paid through cash which was personally collected by Sr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... relation with them. These two Statements of the transporters (who were independent) depict as to what happened at the Consignor's end i.e., in Vijayawada. The narrations of the events in SCN get proved by these Statements beyond any doubt." We find that these statements, prima facie, do not constitute adequate evidence to find the charge that HRPL arranged loading of goods at their factory in the name of fictitious firms. 7. The Commissioner goes on to record that since various statements were already discussed at length in show cause notice, she did not want to discuss the same in the impugned order. However, she inferred from the statements that Shri Sama Rajasekar, Managing Director of HRPL had devised a mechanism to remove the goods clandestinely by suppressing the description and under-valuing the goods. He floated fictitious firms in the name of M/s. Kalyan Chemicals, M/s. Prasad Chemicals and M/s. Priya Chemicals, which did not physically exist. He had opened bank accounts in the name of the employees and conducted transactions through these accounts; arranged to manufacture and clear goods clandestinely to remain within the exemption limits during the material period; he ..... X X X X Extracts X X X X X X X X Extracts X X X X
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