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TMI Blog2017 (11) TMI 874X X X X Extracts X X X X X X X X Extracts X X X X ..... d that: - We do not find any provision in Central Excise Act and Rules made thereunder to confiscate raw-materials. The goods seized at the trading premises and godown of M/s Om Textiles & M/s Sagar Trading Co. were returned to M/s Om Textiles & M/s Sagar Trading Co. by the representatives of Revenue on 13/10/2003. Therefore, we accept the contentions raised by the ld. Counsel for the respondents in respect of this issue. Appeal dismissed - decided against Revenue. - E/3602, 3603, 3604, 3605 & 3606/2006-EX[DB] - A/71328-71332/2017-EX[DB] - Dated:- 26-9-2017 - Mr. Anil Choudhary, Member (Judicial) And Mr. Anil G. Shakkarwar, Member (Technical) Shri Pawan Kumar Singh, Superintendent (AR), for Appellant Shri Amit Awasthi, Advocate, for Respondent ORDER Per: Anil G. Shakkarwar The above stated five appeals have been filed by Revenue and are directed against common Order-in-Appeal No. 358-362-CE/APPL/KNP/2006 dated 31/07/2006 passed by Commissioner of Central Excise Customs (Appeals), Kanpur. 2. The brief facts of the case are that the respondents M/s L. Kant Paper Mills Ltd. were engaged in the manufacture of M. S. Ingots, Poster Paper Media Pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xcise Rules, 2002 for violation of Rule 4, Rule 6, Rule 8 Rule 11 of the Central Excise Rules, 2002, as discussed in the foregoing paras; Shri Anil Agarwal, Proprietor M/s Anil Steels, Kanpur is also required to show cause to the Additional Commissioner, Central Excise Commissionerate, Kanpur as to why cash amounting to ₹ 7.00 lacs seized from the residential premises of Shri Anil Agarwal should not be confiscated under Section 121 of the Customs Act, 1962, as made applicable to Central Excise matters vide Notification No. 68/63-CE dated 04/05/1963 issued under Section 12 of the Central Excise Act, 1944. 3. The issue was adjudicated through Order-in-Original No. 05/Joint Commissioner/2006 dated 20/02/2006 The order of the Original Authority is reproduced below:- 1) I confiscate the 59.701 MT of Ingots valued at ₹ 6,56,711/-, 8040 kgs. Paper valued at ₹ 1,04,520/- 3426 sqms. of Processed Fabrics valued at ₹ 54,816/- under Rule 25 of the Central Excise Rules, 2002. However, I give an option to redeem the same on payment of redemption fine of ₹ 1,35,000/-, ₹ 21,000/- ₹ 11,000/- respectively. 2) I confiscate the 166 bales o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... njay Agarwal, Proprietor of M/s Om Textiles under Rule 26 of the Central Excise Rules, 2002. 11) I impose a penalty of ₹ 25,000/- on Shri Suresh Chhabariya, Proprietor of M/s Sagar Trading Co. under Rule 26 of the Central Excise Rules, 2002. 4. Being aggrieved by the said order, the respondents preferred appeals before Commissioner (Appeals). The ld. Commissioner (Appeals) decided the said appeals through impugned Order-in-Appeal No. 358-362-CE/APPL/KNP/2006 dated 31/07/2006, wherein the ld. Commissioner (Appeals) reduced redemption fine in respect of M. S. Ingots, Poster Media Paper Finished/Processed Man Made Fabrics. Further the ld. Commissioner (Appeals) dropped the demand on Processed Fabrics at the trading premises of M/s Om Textiles and M/s Sagar Trading Co. and also dropped proceedings in respect of Processed Fabrics found at the godown of M/s Om Textiles. The ld. Commissioner (Appeals) also reduced the redemption fine on Grey Fabrics found at the godown of the M/s Calcutta Express Transport Service and ordered to release cash of ₹ 7 lakhs seized from the residential premises of Shri Anil Agarwal. Being aggrieved by the said order, the Revenue pref ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... confiscation of the Grey Fabrics beyond the quantity of 8908 meters during the appeal proceedings appears to be improper. 3. The confiscation of the seized goods of M/s Sagar Trading Co. M/s Om Textiles and demand against such goods from M/s L. Kant Paper Mills Ltd. were dropped during the appeal proceedings. In this context it is stated that the search was conducted on 25/09/2003 and the said finished fabrics were seized in the following circumstances: (a) There were no supporting documents on the day of search i.e. 25/09/2003 in respect of the finished fabrics lying at the common trading premises of the two parties i.e. at 55/67 B, Raja Market, Kahu Kothi, Kanpur. (b) There were no supporting documents on the day of search i.e. 25/09/2003 in respect of the finished fabrics lying at the godown of M/s Om Textiles. (c) These two parties were unable to support the stock of respective processed fabrics the period 25/09/2003 to 12/10/2003 ever after 18days of search. The purchase documents submitted after a substantial period of time clearly indicates that the documents namely invoices, bills etc. were not genuine and they were simply managed to support the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Further the vacation of the confiscation of seized cash was also improper. Hence, setting aside of the penalty on the aforesaid grounds is not proper. As regards the reduction of penalty of Shri Laxmi Kant Agarwal is concerned, he was the key person who designed and implemented the entire unaccounted transactions not only in this case but also in other case of evasion of duty to the tune of ₹ 4.43 Crore pending adjudication against the party. 6. Heard the ld. A. R. for Revenue, who has presented the grounds of appeal, as hereinabove. 7. Heard the ld. Counsel for the respondents, who has submitted his written submission and refuted the grounds of appeal filed by Revenue. The submissions by the ld. Counsel for the respondents are as follows:- 1. Refutation of Ground No. 1 and 2 of Revenue Appeal i) In respect of Ground No. 1 and 2 taken by the Revenue, it is submitted that in any view of the matter Raw material and Finished Goods within the factory cannot be held liable for seizer or confiscation. Reliance is placed on Final Order No. A/70434-70438/2017-EX[DB] dated 12.04.2017 in the case of Kashi Laminators Pvt. Ltd. others ii) That only 8908 Mtrs. o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ellants as early on 13.10.2003 to support licit purchase of goods and the Show Cause Notice which was issued on 22.03.2004 is totally silent about this major aspect. In light of the circumstances, I hold that in absence of any proof that the material was non-duty paid and in absence of any Show Cause Notice to M/s Om Textiles M/s Sagar Trading Co. neither the goods seized from the godown / trading premises of M/s Om Textiles M/s Sagar Trading Co. can be ordered to be confiscated nor the Appellant No. 1 can be held liable to duty on said 'goods consequent equivalent penalty'. Accordingly, I set aside the confiscation of the goods seized from the godown /trading premises of M/s Om Textiles M/s Sagar Trading Co. and I also set aside the duty liability in respect of said goods equivalent penalty imposed upon Appellant no. 1 in this regard. 3. Refutation of Ground No.4 of Revenue Appeal i) So far as Respondent No. 1 is concerned in as much as Finished Goods and Raw Material found within the factory are not liable to seizure or confiscation under Rule 25 of the Central Excise Rules, 2002. As such no redemption fine was warranted in the matter. Moreover, it is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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