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TMI Blog1998 (8) TMI 296X X X X Extracts X X X X X X X X Extracts X X X X ..... 11800 were lying in the godown of M/s. Kabra Enterprises. On examination of the said C.F.Cs. and Cigarette Packets contained in them, it was found that C.F.Cs packets, slides and outers, each containing 25 packets of cigarettes have the name of manufacturer as M/s. M.P. Tobacco Company Limited printed on them. On examination of the Cigarette Packets, it was noticed that most of the packets have Rs. 95' printed on them with `01' embossed before Rs. 95'. On demand, Shri B.L. Kabra, Proprietor of M/s. Kabra Enterprises produced stock register indicating total stock of 110 C.F.Cs. of Esquire Filter Cigarettes. Stock Register showed that no consignment of Esquire brand cigarettes was received by him after September, 1994. The 110 C.F.Cs. were detained for further verification. 3. Shri B.L. Kabra's statement was recorded under Section 114 wherein he stated that 110 C.F.Cs. were manufactured by M/s. M.P. Tobacco Company Limited and the Cigarette Packets are having the month of packing as 1/95 or 95. On being asked as to why Esquire Filter Cigarettes with month of packing 1/95 and 95 are lying in the godown, he deposed that being a slow moving items, these C.F.Cs. have been received ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s were supervised by Central Excise Officers posted in the factory and, therefore, there could be no clandestine manufacture or clearances. It was also argued that the Department has not produced any evidence about excess receipt of cut tobacco clandestinely to manufacture the 110 C.F.Cs.; that no documentary evidence was produced by the Department regarding payment of money by M/s. Kabra Enterprises to M/s. M.P. Tobacco Company Limited; that Shri Paramanand Sahu, incharge of M/s. GTC Industries Ltd.'s Godown at Durg had exchanged the C.F.Cs. twice immediately after their receipt on the verbal request of Shri B.L. Kabra; that total stock of cigarettes at M/s. Kabra Enterprises agreed with the book balance; that there was no record of exchange of C.F.Cs. as it was not required under Central Excise Rules. 6. M/s. GTC Industries Ltd., inter alia, argued that they had not maintained any account of S.L. Nos. of C.F.Cs. received, sold and in stock as they had not attached any importance to it; that it was a normal business transaction; that the total balance of cigarettes tallied with the book stock; that on the verbal request of Shri B.L. Kabra, they exchanged old stock of cigaret ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y of Rs. 3.00 Lakh on M/s. GTC Industries Ltd., Durg; a penalty of Rs. 3.00 Lakh on M/s. Kabra Enterprises; a penalty of Rs. 1.00 Lakh on Shri H.L. Sarawgi and a penalty of Rs. 1.00 Lakh on Shri Paramanand Sahu. Being aggrieved by this order, the Appellants have filed the captioned Appeals. 10. Smt. Rohina Nath, Shri N. Khaitan, Shri R.K. Goel, and Shri Rahul Rai, the ld. Advocates appeared for the Appellants. Arguments were led by Shri N. Khaitan, the ld. Counsel representing M/s. M.P. Tobacco Company Limited. He reiterated the submissions already made and emphasized that it was the normal practice in the trade that to keep the regular distributors happy, stocks of cigarettes were replaced. He submitted that cigarettes have a very short shelf life; that they start deteriorating after some time depending upon the packing etc. He submitted that M/s. Kabra Enterprises and M/s. GTC Industries Ltd., Durg are the wholesale dealers of M/s. M.P. Tobacco Company Limited. He submitted that in the instant case, M/s. Kabra Enterprises requested M/s. GTC Industries Limited to replace old stock of C.F.Cs. of a particular brand by fresh stock. He submitted that it was a normal business pra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3 were cleared to M/s. GTC Industries Ltd. on 24-12-1994 and M/s. GTC Industries Ltd. on the same day sent them to M/s. Ganapathi Traders, Patna. The ld. DR submitted that, thus, the contention of the Appellants that twice they had replaced the Cigarettes is not supported by the facts on record. The C.F.Cs. were found cleared on 3 days i.e. on 11-10-1994, 15-10-1994 and 24-12-1994 and not on two occasions as contended by the Appellants. He submitted that all these cigarettes were cleared during the period before 1st of January, 1995 whereas the cigarettes found were manufactured on or after 1-1-1995 as was evident from the month of packing embossed on the Cigarette Packs. 13. Reiterating the findings in the Order-in-Original, the ld. DR submitted that a case has been made out by the Department against the Appellants and prayed that the appeals may be rejected. 14. We have heard the submissions of both sides. We have perused the evidence on record. The main allegation against the Appellants is that they had manufactured the cigarettes clandestinely and removed them clandestinely and were concerned with sale/purchase, transport etc. of these cigarettes. For provin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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