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TMI Blog2013 (7) TMI 216X X X X Extracts X X X X X X X X Extracts X X X X ..... it availed by the AMA-II amounting to Rs.1,34,38,515/- and credit of education cess of Rs.2,17,325/- wrongly availed as also with interest and imposed penalty equal to the CENVAT credit denied and demanded; ii. confirmed a demand for duty amounting to Rs.93,52,000/- and education cess of Rs.1,87,040/- on clandestine removal of finished excisable goods viz. Aluminium Alloy Ingots by AMA-II with interest and also imposed penalty equal to the duty demanded; iii. confirmed demand for duty of Rs.96,423/- on finished excisable goods clandestinely cleared by M/s. Agarwal Metals & Alloys(Unit-l) and with interest. Further penalty was also imposed equal to duty demanded. In addition, penalties have been imposed on Shri Samir Agrawal, Partner of AMA-II - Rs. 12 lakhs, Shri Vipul Agrawal, Partner of AMA-II - Rs.12 lakhs, Shri Narsingh Swamy, Authorised signatory of AMA - Rs.2 lakhs, Shri Ramniwas Swamy, Authorised signatory of AMA - Rs.2 lakhs, Shri Shailendra, Authorised signatory of AMA - Rs.1 lakh, Shri V.K. Jha, Spector-in-charge of AMA - Rs.50,000/-, Shir Surjeet Singh Chawla, Partner of M/s. Chawla Roadlines - Rs.5 lakhs, M/s. Kishore & Co. - Rs.1 lakh, M/s. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AMA-II or not. In the case of M/s. Metal Link Alloys Ltd., Daman also, it was found that there was no transport and the transporter admitted that he has never transported the goods. The investigation also revealed that the AMA-II had adjusted the non-receipt of inputs by showing excess production of ash and generation of steel scrap. While the Aluminium scrap purchased had higher percentage of Aluminium, the finished ingots had a lower percentage. Since the exact quantity could not be worked out relating to non-receipt of Aluminium raw materials, the investigators worked out the quantity based on SION. Shi Narsingh Swamy, Authorised Singatory admitted the shortage and the test reports were authenticated by the functionaries of AMA-II. 2.2. The appellants submitted that on the one hand Department has demanded CENVAT credit on the ground that inputs were not received whereas on the other hand they have demanded duty on clandestine removal and both cannot co-exist. However, on going through the records, we find that this submission was never made before the Commissioner or the investigating officers. In any case, we find that the case relating to clandestine removal is based on non- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... more than Rs.94 lakhs can be justified on that ground. 3.1. Evidences relied upon by the Revenue for taking this view is production of excess ash and the sale of the same to fictitious buyers. It is to be noted that generation of Aluminium ash and iron waste has been shown to be around 33% of the total production whereas it is quite well known that in Aluminium industry other than melting loss and evaporation of 2 to 3%, there cannot be any other loss. The generation of this kind of quantity of ash & scrap itself supports the case of the Revenue We cannot find fault with the reliance of the Revenue on the statement of an officer of NALCO for ascertaining the possible percentage of wastage, which appellants have found fault with. On the other hand, appellants have not been able to show any contra technical information or expert opinion to show that such excess ash and iron waste can be generated. Further, officers also have gathered evidences in the form of statements of transporters to show that no ash or iron waste was transported and also made efforts to contact the buyers. None of them can be traced out. Further, one of the buyers, Shri Radheshyam Yadav, Authorised signatory of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ything to say against the findings or conclusions of the investigators. Further, we also find that the Commissioner has considered all these submissions and has discussed vis-a-vis evidences gathered. 4. The Commissioner has found that clearances under Invoice No.1 to 6 on 29/03/2004 and 30/03/2004 were made in the name of AMA-I even though goods were manufactured by AMA-II. This finding is supported by the statements of Shri Narsingh Swamy who had admitted that the goods were in fact manufactured by AMA- II. Shri Narsingh Swamy not only stated that the invoices were raised in the name of AMA-I though goods were manufactured by AMA-II, he also gave reasons for the same which is to avail the benefit of Sales Tax and Income Tax. Shri Samir Agarwal, Partner of AMA-II in his statement never disputed the panchnama or the statement of Shri Narsingh Swamy. There are no submissions in this regard by both sides but we find that the Commissioner's findings in this regard are required to be upheld and, therefore, duty demand, interest and penalties are imposable. 5. Liability of penalty in respect of M/s. Kishore & Co., M/s. Consumer Products and M/s. Steel and Metals. 5.1. In respect of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... adlines played a crucial supportive role as held by the learned Commissioner facilitating evasion of Central Excise duty by AMA-II. 7. Supply of raw materials by M/s. Metal Link Alloys Pvt. Ltd. and its liability for penalty. 7.1. In respect of the allegation that M/s. Metal Link Alloys Pvt.Ltd. had supplied only invoices and no goods, Shri Ajaykumar Gupta, Authorised Signatory stated that they had transported Aluminium ingots to AMA-II through M/s. Royal Transport of India, Vapi and transportation was managed by AMA-II and it had no comments to make about statements of the transporters and owners of the vehicles. One of the vehicle which was shown to have transported Aluminium ingots was transporting cement from Sangipuram to Gandhidham on those days according to the owner. Another owner also confirmed that he had never transported Aluminium ingots. Shri Ramesh Chaudhary, Proprietor of M/s. Royal Transport of India admitted that in respect of three consignments, they had issued only LRs and no transportation took place. There is enough evidence, therefore, to show that there were no transportation of Aluminium ingots. 8. Liability of M/s. Royal Transport of India for penalty: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Commissioner that in-house test reports of the company were relied upon for the purpose of deciding the purity etc. This would give an indication that the test reports were properly prepared. Further, there is no admission by Shri V.K. Jha that he was involved in accountal of production and removal etc. The benefit of doubt has to be extended to Shri V.K. Jha. 9.4. Shri Samir Agarwal, Partner was overall in-charge under whose supervision the activities took place and Shri Vipul Agarwal looked after the production side and Shri Samir Agarwal looked after the other aspects. Both of them are partners in the firm and such huge evasion could not have taken place without their knowledge and without their participation and without their intention. Under these circumstances, penalty is liable to be imposed on both of them. However, since the penalty to the extent of 100% equal to duty has already been imposed on the firm. we propose to take a slightly lenient view as regards penalty on the partners since the liability to penalty on the firm also ultimately would have to be paid by the partners only even though partners are separate from the firm. 9.5. Accordingly, the penalties imposed u ..... X X X X Extracts X X X X X X X X Extracts X X X X
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