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TMI Blog2001 (5) TMI 515X X X X Extracts X X X X X X X X Extracts X X X X ..... . 3) under Rule 209A of the Rules. The Commissioner had also ordered the confiscation of the vehicle with the option to the owner (Shri Om Prakash Tolani, Appellant No. 4) to get the same redeemed on payment of redemption fine of Rs. 50,000/-. He had further ordered the confiscation pan masala and raw material found lying in the factory premises with option to get the same redeemed on payment of redemption fine of Rs. 5000/- and Rs. 25,000/- respectively by the owner. Similarly, the plant and machinery had been also ordered by him to be confiscated with option to the owner to get the same redeemed on payment of redemption fine of Rs. 3 lakhs. 2. The facts giving rise to these appeals may briefly be stated as under. 3. M/s PGL Company were engaged in the manufacture of pan masala under the brand name Prince and Yamu . The company had two manufacturing units one located at Noida and the other at village Dallupur both registered with the Central Excise Department, but the company was found running another unit at F-42, Jawahar Park, Laxmi Nagar, Delhi where they were indulging in the manufacture of pan masala under the same brand name and were clearing the goods in a clandestin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a (Appellant No. 3), in his statement admitted that this unit at Laxmi Nagar was being run by him. He denied that it was the unit of the company PGL. The statements of the officers of the companies M/s. Flex Pouches Fill (P) Ltd. and M/s. Techno Fill (P) Ltd. who sold the machines found fitted in the unit at Laxmi Nagar, Delhi to the company PGL were also recorded and the machines were got identified from those officers by showing them the photographs. 5. After completion of the investigation show cause notice dated 6-4-1995 was served on all the appellants wherein all the above referred facts were detailed and documents relied upon were also mentioned. All the appellants contested the correctness of that notice. The company PGL and its Managing Director Hari Bhai Lalwani, denied their concern with the unit found manufacturing pan masala at Laxmi Nagar at Delhi under their brand name Prince and Yamu and further avered that they had already filed civil case against Sunil Kumar Khanna (Appellant No. 3) for misusing their brand name Sunil Kumar Khanna (Appellant No. 3) in his reply, however, admitted that the unit was owned by him individually. He denied the concern of the compan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 12. The show cause notice issued to the company PGL (Appellant No. 1) and the Managing Director was on the allegations that the unit detected manufacturing the pan masala under the brand names Prince and Yamu at Laxmi Nagar, Delhi was owned by them and they were liable to pay the duty and the penalty as they had been clearing the goods from that unit without payment of Excise duty. For holding that these allegations stood proved against them the Commissioner had relied upon the evidence consisting of statements of Babu Bhai T.A., K. Soman, R.C. Rastogi, B.R. Thapalyal, certain documents recovered from the room of K. Soman and installation of telephone belonging to Hari Bhai Lalwani (Appellant No. 2) at the factory premises, but this entire evidence if scanned thoroughly keeping in mind the version furnished by the appellants in their reply to the show cause notice and the other material on record, it becomes quite evident that the conclusion arrived at by the Commissioner against the company PGL (Appellant No. 1) and the Managing Director, Hari Bhai Lalwani (Appellant No. 2) can not be legally sustained. 13. According to the allegation in the show cause notice Babu Bhai T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o 13-2-1994 and an intimation of his having left the job was sent to the ESI authorities in the half yearly returns for the period October, 1993 to March, 1994. The copies of the attendence register and of the letter addressed to ESI authorities had been placed on record by the company PGL. Similarly K. Soman resigned from the company PGL on 11-7-1992 as is evident from the copy of the letter of his resignation which is at page 86 of the Paper Book. He was never marked present in the attendence register after that date. 15. The fact that both these persons were still found in possession of identity cards of the company and the cards issued by ESI at the time of recording their statements and taking search of the room of K. Soman, could be attached much legal value, when there was overwhelming evidence referred to above, to prove that they left the company PGL (Appellant No. 1) long back from the date of visit of the Excise staff to the factory at Laxmi Nagar where they were found working on 21-10-1994. Shri Sunil Kumar Khanna (Appellant No. 3) who was admittedly overall incharge of the factory at Laxmi Nagar, Delhi, never admitted that these two person were not his employees but ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from all the entries of that register placed on file. Therefore, by retaining the identity card of the company and of the ESI, after leaving the job he could not be said to be still an employee of the company PGL (Appellant No. 1). None of the entries in the loose sheets, slip pads or other documents, detailed above recovered from his room also contained any reference about his employment directly or even indirectly in the company PGL (Appellant No. 1). 17. Similarly, much reliance could not be placed on the statements K.R. Thampallya of M/s. Flex Pouches (P) Ltd. and R.C. Rastogi of M/s. Techno Fill (P) Ltd. for holding that the machines found installed in the factory premises at Laxmi Nagar were the same which were sold by the companies of these witnesses to the company PGL (Appellant No. 1). Both these witnesses did not themselves supervise or see the installation of the machines in that factory. They were shown only photographs of those machines and they could identify only one or two machines. Shri R.C. Rastogi in his statement only stated that only one machine had monogram of his company and not others and further deposed that possibility of the other parties procuring the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... found to be indulging in the manufacture and clandestine removal of the pan masala, was owned or taken on rent by the company PGL or its M.D. Hari Bhai Lalwani (Appellant No. 2). No proof in this regard had been brought on record by the Revenue. Rather the perusal of the show cause notice itself shows that the factory premises belonged to Smt. Usha Bhutta and her statement was recorded during investigation by the Excise staff. She in her statement did not support the case of the Revenue at all. She rather stated that the premises were taken on rent of Rs. 2000/- per month from her by Sunil Kumar Khanna and she was getting the rent from him only. She denied the nature of the work being carried out in her premises. Her statement could not be at all ignored being of independent witness. 20. There is also no material on record to prove that the raw material was being supplied to Sunil Kumar Khanna (Appellant No. 3) in that factory by the company PGL and its Managing Director Hari Bhai Lalwani (Appellant No. 2) or that they were getting back the finished goods from Sunil Kumar Khanna. No proof of their consent to Sunil Kumar Khanna for using their brand names Prince and Yamu for t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... indulging in the manufacture and clandestine removal of the pan masala without payment of duty, under the brand names Prince Yamu . He did not dispute his liability for the payment of the Excise duty. He in his statement recorded on 16-11-1994 reiterated this very fact and gave the full details as to when and how he started his factory after getting the premises on rent from Smt. Usha Bhutta, the landlady. He also disclosed the names of the workers including that of Babu Bhai T.A. and K. Soman, employed by him in the factory. He himself, as stated by him, was ex-employee of the company PGL (Appellant No. 1) as he remained during the year 1990 to 1992 as salesman in the office of the company at Pune. He had denied that after leaving the job in December, 1992 he was ever re-employed by the company PGL (Appellant No. 1). His denial has been, however, doubted by the Commissioner, as is evident from the impugned order, on the ground that he was found present at the time of raid on another unit of the company on 21-10-1994 and there he made a statement that he had come to the factory with Hari Bhai Lalwani and was collecting salary from his house. But even from his that statement it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 09A of the Rules could be legally imposed by the Commissioner. Therefore, the impugned order against both these appellants deserves tobe set aside. 24. Against Om Prakash Tolani (Appellant No. 4) the learned Commissioner had ordered the payment of redemption fine of Rs. 50,000/- by him for getting the seized vehicle released. But such an order could not be passed when the Commissioner himself had observed at page 32 of the impugned order, that there was no evidence to prove that Om Prakash (Appellant No. 4) had the knowledge that his truck was being used for the transport of contraband goods as he only used to give the truck on hire. Therefore, the impugned order of the Commissioner against him cannot be sustained. 25. In the light of the discussion made above, the impugned order of the Commissioner against Appellants No. (1), (2) and (4) is set aside while against Appellant No. (3), Sunil Kumar Khanna, is upheld regarding penalty, confiscation of machines, raw material and finished goods seized from his factory and imposition of redemption fine on him. Accordingly the appeal Nos. E/2181/98-NB, E/2178/98-NB and E/2022/98-NB of Appellants Nos. (1), (2) and (4) respectively are a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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