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TMI Blog2011 (3) TMI 948X X X X Extracts X X X X X X X X Extracts X X X X ..... of law and facts arise in both the appeals they were heard together and are being disposed of by this common order. 3. Both the appeals arise from common order dated 31.03.2010 passed by the Commissioner, Indore. By the impugned order, the duty demand of Rs. 1240084/- has been confirmed against the company alongwith imposition of penalty of Rs. 60 lakhs under Rule 26 of the Central Excise Rules, 2002 and Rs. 30 lakhs under Section 112 of the Customs Act, 1962 against the appellant Shri Ashwani Deewan and penalty of Rs. 6 lakhs under Rule 26 of the said Rules and Rs. 3 lakhs under Section 112 of the said Act against the appellant Shri Mahendra Sharma. These appeals are confined the challenge to the penalty imposed against the appellants herein. 4. Learned Advocate for the appellants submitted that under order dated 11.11.2008, the Tribunal had remanded the matter to the Commissioner to deal the levy of penalty against the appellants afresh and accordingly the impugned order came to be passed. However, the authority imposed the penalty ignoring the basic requirement of provisions of Rule 26 of the said Rules as well as that of Section 112 of the said Act inasmuch as that both th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o be confiscated under the Act or the Rules made thereunder, then the penalty not exceeding the duty on such goods or Rs. 2,000/- whichever is greater can be imposed. 7. Section 112 of the said Act, deals with the subject of penalty on improper importation of goods etc. It provides that any person, who, in relation to any goods, does or omits to do any act which act or omission would render such goods liable to confiscation under Section 111, or abets the doing or omission of such act, or who acquires possession of or is in any way concerned in carrying, removing, depositing, harbouring, keeping, concealing, selling or purchasing or in other manner dealing with any goods which he knows or has reason to believe are liable to confiscation under Section 111 shall be liable to various penalties as specified in different circumstances as described under the said provision of law. 8. Evidently, therefore, whether it is under Rule 26 of the said Rules or under Section 112 of the said Act, a person for having dealt with any goods in any manner can be made liable to pay the penalty as prescribed provided the goods are either excisable goods or the contravened goods and such person knows ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isions contained in the Central Excise Act, 1944 and the Rules made thereunder. He added and abetted and also acted in all the act of evasion by the assessee No. 1 and No. 2. By his above mentioned act Shri Mahendra Sharma the assessee No. 3 has also rendered himself liable to penal action in terms of Rule 26 of the Central Excise Rules, 2002. Shri Mahendra Sharma was also responsible for diversion /sale of duty free imported SKO/HSD and for not using the same in the factory premises for intended purpose. By doing so, Shri Mahendra Sharma also rendered himself liable for penal action under Section 112 of the Customs Act, 1962 for his active role in evasion of duty of customs as well by the assessee No. 1 . 11. Apparently, therefore, the authority had clearly arrived at the basic findings required to sustain the decision in relation to penal liability of the appellants. Undisputedly, the same findings were not disturbed by the Tribunal in the order dated 11.11.2008. While remanding the matter, it was essentially remanded on the point of quantification of the penalty. This is apparent from para 8, 9 and 10 of the said order dated 11.11.2008 which read thus:- 8. This is a conseq ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by him only in his own handwriting. He had engineered the modus operandi for evasion of duty with the help of Sh. Mahendra Sharma who as per his direction manipulated all documents, even forged the official documents, signature seal of Central Excise Officials. Investigation revealed that Sh. Deewan had created two firms viz M/s ADB Trade Services and M/s Jas Expoship P. Ltd. both owned managed by him only. In order to circumvent the law to siphon off the sale proceeds generated out of clandestinely cleared goods, he managed to receive the payments through above named companies. He had been managing the funds, at his own will, between M/s ADB Trade, M/s Jas Expoship M/s C.T. Cotton Yarn Ltd. Investigation also revealed that noticee No. 1 procured duty free imported HSD/SKO. The entire quantity of such duty free imported material was not brought into the factory premises but sold in open market without payment of appropriate duties of customs, without issue of invoice without accounting in the statutory records. All these activities were done on the direction of Shri Deewan. 30. Sh. Ramesh Nair, Advocate on behalf of noticee No. 2 has submitted reply dated 11.05.09 tha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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