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TMI Blog2017 (3) TMI 987X X X X Extracts X X X X X X X X Extracts X X X X ..... cco was fully exempt from duty. Besides this, M/s. Praveen Tobacco Company were dealing in unmanufactured hookah tobacco purchased from various sources and M/s. Praveen Tobacco had also a godown at Village Rai, District- Sonepat for unmanufactured hookah tobacco. M/s. Mittal Trading Company with Shri Manish Mittal S/o Shri Rajinder Kumar Mittal as its proprietor is a trading company and from their premises at Village - Sanoth, Bawana, Narela Road, Delhi, they are trading in unmanufactured hookah tobacco. M/s. Tarun Goel Tobacco House, M/s. Brijwasi General Store, M/s.Nanak Chand Om Prakash, M/s. Chander Kumar Soni Store are the dealers, who are alleged to have purchased Praveen Chhap Tobacco from M/s. Praveen Tobacco Company, which is alleged to have been cleared without payment of duty. On 29.05.2009, the factory premises of M/s. Praveen Tobacco at G.T. Karnal Road, Industrial Area, Delhi and the premises of M/s. Mittal Trading Company at Village Sanoth, Bawana Road, Delhi were searched, in the course of which, the stock of finished goods and raw material was checked. In the premises of M/s. Praveen Tobacco Co. Ltd., shortage of 74,988 kgs. of unmanufactured hookah tobacco was fou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respect of the chewing tobacco seized from the premises of the above traders, separate proceedings had been initiated for its confiscation and imposition of penalties, which are not part of the present order. 1.4 Against the above order of the Commissioner, all the appellants i.e. M/s. Praveen Tobacco Company, M/s. Mittal Trading Company, M/s. Tarun Goel Store, M/s. Brijwasi General Store, M/s. Ashok Kumar & Sons, M/s. Chander Kumar Soni Store, Shri Rajinder Kumar Mittal and Shri Praveen Kumar have filed the present appeals to the Tribunal. 2. With the above background, we heard Shri J.P. Kaushik, advocate for the appellants and Sh. GR singh, DR for the respondent. 3. Shri J.P. Kaushik, Advocate, ld. Counsel for the appellants pleaded that- (a) the impugned order has been passed without application of mind inasmuch as while the last hearing in this matter was held on 27.02.2013, the Commissioner's order running into 80 pages and with fair copy signed has been issued on 28.02.2013, (b) the stock taking reports in respect of the stock of M/s. Mittal Trading Company on 8.6.2009 and stocking taking of the godown of M/s. Praveen Tobacco at Plot No.1277, Ph-V, HSIDC, Rai, Sonepat o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aveen Tobacco and M/s. Mittal Trading. He also pointed to para 24 of the show cause notice which mentions that 74988 kgs. of unmanufactured hookah tobacco and 725 kgs. of leaf tobacco (Orcha) were found short vis-à-vis the balance in the raw material account in the premises of M/s. Praveen Tobacco and shortage of 66045 kgs. of unmanufactured hookah tobacco in the premises of M/s. Mittal Trading on 29.05.2009 and thus, the total shortage comes to 1,41,758 kgs. He mentioned that it is further alleged that this huge quantity of raw tobacco was used by M/s. Praveen Tobacco for manufacture of unmanufactured Praveen Spit Tobacco. He pleaded that the allegation of the Department is that 141033 kgs. of unmanufactured hookah tobacco found short in the premises of Praveen Tobacco and Mittal Trading had been used in the manufacture of Praveen Chhap Tobacco. But though a plea specifically was made before the Commissioner that unmanufactured Hookah tobacco consisting of dust, rawa, tobacco, stems, kampala, nus (veins of the leaf), etc. cannot be used for manufacture of Spit /Chewing tobacco but still the Commissioner, without considering this plea, has confirmed the demand by treating th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al as 11.50 A.M., the invoice did not appear to cover the goods loaded in the Maruti Van as it was found, that description of the goods as mentioned in the invoice was not matching with the description as physically found. 4.5 On 29.05.2009, another vehicle no.DL1LJ9349 loaded with 20 bags each of 45 kgs. of cut tobacco was intercepted near the factory premises of Praveen Tobacco. Driver of the vehicle stated that these goods were loaded in the godown of Mittal Trading Company at Narela. There was no invoice accompanying the goods and according to the Driver, he was bringing two such consignments every day. 4.6 Unmanufactured hookah tobacco referred to in para-24 of the show cause notice was found short in the premises of Praveen Tobacco and Mittal Trading and is same as unmanufactured cut tobacco and can be used for manufacture of spit chewing tobacco (Khaini). This is clear from the statement dated 7.6.2011 of Shri Krishna Kumar Agarwal of M/s. Krishna Kumar Agarwal and Brothers. Shri K.K. Agarwal is a supplier of cut tobacco. Shri G.R. Singh referred to para 21 of the show cause notice and pleaded that from the scrutiny of the Sale & Purchase Orders of the Praveen Tobacco Comp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o searched. According to the appellant, if the stock of unmanufactured hookah tobacco found in the godown at Village-Rai, District-Sonipat is taken into account and also the result of the stock taking in M/s. Mittal Trading Company on 7.6.2009 is taken into account, overall there was no shortage of hookah tobacco. At the time of search of the premises of M/s. Praveen Tobacco Company, certain excess stock of pouches of chewing tobacco had been recovered. From the premises of their dealers, i.e. M/s. Tarun Goel Tobacco House, M/s. Brijwasi General Store, M/s. Ashok Kumar & Company, M/s. Chander Kumar Soni Store, certain quantity of unaccounted Praveen Chhap chewing tobacco had been recovered which had been placed under seizure. From the premises of these dealers, certain documents had been recovered, which indicated receipt of the Praveen Chhap tobacco from Praveen Tobacco Company in respect of which there were no central excise invoices. According to the Department, this indicates that M/s. Praveen Tobacco Company were indulging in evasion of duty. The duty demand in the present case, as mentioned in para 24 and 25 of the show cause notice, had been determined on the basis of the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pellant in course of proceedings before the Commissioner has been that unmanufactured hookah tobacco consists of dust, leaf, stems, nus, rawa, etc. and the same is fit only for making hookah tobacco and cannot be used for making chewing tobacco and that for making chewing tobacco, the leaf of tobacco (Orcha) is required and accordingly, the appellant's contention is that no duty demand can be made on the basis of the shortage of 141033 kgs. of unmanufactured hookah tobacco and the duty demand based on the shortage of 725 kgs. of Orcha tobacco would be only about around Rs. 15,000/- . 7.1 We find that on this point, no finding has been given by the Commissioner. He has simply concluded that the demand is based on the shortage of "raw cut tobacco". In our view, para-24 of the show cause notice itself mentions, the shortage of about 1,41,033 kgs. of unmanufactured hookah tobacco at the premises of Praveen Tobacco Company and M/s. Mittal Trading Company and shortage of 725 kgs. of Orcha Tobacco in the premises of M/s. Praveen Tobacco Company and the Commissioner's finding that the entire shortage is in respect of cut tobacco, prima facie, does not appear to be correct. Moreover, the C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e stock register of the main noticee wherein it was clearly mentioned „Raw Tobacco register'. However, the appellants' contention is that in the factory premises, separate registers for orcha leaves as well as Hookah Tobacco were being maintained. On this basis, they have argued that the demand raised is not sustainable. 12. We note that during the course of search on 8/6/2009 at the premises of M/s Mittal Trading company and godown of M/s Praveen Tobacco at Sonipat on 12.06.2009, samples of unmanufactured Hookah Tobacco were drawn for testing. The relevant test reports have not been made available to the appellant. We are of the view if such test reports are available, the same may throw light on the question, whether such unmanufactured Hookah Tobacco can be used for making spit Tobacco. 13. As explained in the above paragraphs, we note that the impugned order has not discussed, some of the serious arguments raised by the appellant, even though these were made before the adjudicating authority. We also note that these arguments are central to the demand of Central Excise duty raised in the Show Cause Notice. 14. In view of the above, the case is remanded to the Original ..... X X X X Extracts X X X X X X X X Extracts X X X X
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