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TMI Blog2018 (9) TMI 1133X X X X Extracts X X X X X X X X Extracts X X X X ..... these facts and evidences clearly show that various employees and the Director of the appellant were clearly in the knowledge that the supplies were being made for goods, which were liable to confiscation. In fact, any excisable goods cleared by appellant without cover of invoices are also liable to confiscation - The active involvement of the appellant in the entire modus operandi is thus established in relation to fraudulent supply of raw material without payment of duty to M/s HSAL in a well organized manner thereby abetting evasion of duty by M/s.HSAL. Penalty - Held that:- In the instant case, Ferro Alloys were dispatched to M/s HSAL without the cover of the invoices, or the billing was done but no material was dispatched, or the goods were dispatched to M/s HSAL, but the invoices were issued to some other parties. Clearly, the appellant were not merely sending raw material without issuing invoices but were also engaged in other modus operandi. All these were done with sole intent to enable evasion of duty - thus, penalty has rightly been imposed on the appellants for their collaborative role in the conspiracy of clandestine removal of goods by M/s HSAL and enabling evasion ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Cr, Fe Mn and Fe Si have been used for the manufacture of SS Billets/SS Flates. Further, the ferrous content in the unaccounted stock also comes to 128.200 MT. Therefore, it is clear that a total quantity of 576.779 MT of Ferro Alloys has been used surreptitiously to manufacture SS Billet flats. 2. In the adjudication order, following was ordered by the adjudicating authority:- In view of the above discussions and findings, I pass the following orders: (i) I confirm the demand of Excise duty amounting to ₹ 65,32,659 (Rupees sixty-five lacs thirty two thousand six hundred and fifty nine only) and order its recovery from M/s Haryana Steel and Alloys Ltd, 48th K.M.G.T. Road, Murthal, Sonepat (Haryana) under Section 11 (A) (1) of the Central Excise Act, 1944. (i) I impose a penalty of ₹ 65,32,659 (Rupees sixty-five lacs thirty two thousand six hundred and fifty nine only) and order its recovery from M/s Haryana Steel and Alloys Ltd, 48th K.M.G.T. Road, Murthal, Sonepat (Haryana) under Section 11 (A) (1) of the Central Excise Act, 1944 for contravention of the various provisions of the Central Excise Act, 1944 and the Rules made there under, a discuss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AR for the Revenue submitted that the examination of the invoice book used for clearance of Ferro alloys bearing parallel invoice nos. recovered from the Faridabad godown of M/s HAL revealed that the daily report‟ contained each and every activity being done at said godown, which confirms that various types of Ferro alloys had been dispatched to M/s HSAL by M/s HAL without cover of the invoices or billing was done but no material was dispatched or the goods were dispatched to M/s HSAL, but the invoice was issued in the name of some other party. The report was also faxed to their Head Office. He has further submitted that on most of the occasions, the material dispatched to M/s HSAL was shown as SiMn on the invoice while in fact, HCFeCr had been dispatched. He contended that M/s HAL had manipulated the records and invited attention to various pages in file number A-115. He also referred to the admission statement of Hawa Singh and other evidences which have been taken into account by the adjudicating authority. He further submitted that the goods were held liable for confiscation and penalty was correctly imposed on M/s HAL under Rule 209-A vide Para no. 77 of OIO No. 18/Com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ains each and every activity being done at the impugned godown. The report has been prepared in duplicate and a pink copy of which is available in the book while the original white copy has been sent to head office. Fax copy found attached with the daily report confirmed that the same has been to the head office. The details of various Ferro alloys received as reflected in these reports matches with the purchase invoices. The daily report also contains the signature of the godown keeper, Shailender Singh and Ram Kishan. From the above, it is confirmed that (i) Various types of Ferro alloys had been dispatched without bill‟ to HSAL. In these cases, the godown keeper has mentioned the name of the Ferro alloys, the quantity, truck no. and the name of the HSAL to whom the material had been dispatched. (ii) At number of other occasions, only billing have been done and no material has been despatched. In these cases, the type of Ferro alloys, net wt. And the name of purchaser to whom the invoice has been billed, clearly mentioned in the daily report. (iii) On few occasions, the goods had been despatched to HSAL while the invoice had been issued in the name of some o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 22,950/- total amounting to ₹ 49,66,512/- out of which cheques of ₹ 27 lacs had been received. An amount of ₹ 31,041/- was outstanding against HSAL on 01.09.99. 67. The details of FeCr an FeMn sold by HAL to HSAL during the month of May and June‟99 mentioned at Page No.62 and 63 of File No.A-115. A-115 when checked with the invoices issued by HAL finds no corresponding entry in the statutory records clearly prove that these consignments had also been cleared to HSAL without making any entry in the statutory records. On the basis of entries at page 62 and 63, I perused the chart prepared showing the material despatched by HAL to HSAL during the month of May and June and found that the material have been despatched without raising any invoices and thus without any accounting in the statutory records. Truck no. has been given which clearly shows that the goods had been despatched to HSAL. The basis of despatch to HSAL can be attributed to the fact that page no.65 shows the detail of bill no.385/26.08.99, 395/31.08.99 and 398/01.09.99 which all had been consigned to HSAL. Similarly, the details of despatch shown at page no.61 matches with the sale made to H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eld so in para 77 of his order. Besides, the appellant was enabling evasion of duty by M/s.HSAL in a planned and systematic manner. In the case of Aries Telcom (P) Ltd. vs. CC, Chennai-2007 (220) ELT 874 (Tri.-Chennai), this Tribunal took the view that the knowledge of managing director regarding offending nature of goods would partake the character of knowledge of the company as well. In the present case, not only Director Babu Khandewal but godown keeper as well were in the know of offending nature of goods. As pointed out by Ld. AR, the daily report of fraudulent activities at their Faridabad godown had been faxed to the Head Office. The active involvement of the appellant in the entire modus operandi is thus established in relation to fraudulent supply of raw material without payment of duty to M/s HSAL in a well organized manner thereby abetting evasion of duty by M/s.HSAL. 8. The appellants have placed reliance on the judgment of Steel Tubes of India Limited Vs. Commissioner of Central Excise, Indore (supra). I find that the Rule 209-A of Central Excise Rules, 1944 is in pari materia with Rule 26 (1) of the Central Excise Rules, 2004. While analysing the imposition ..... X X X X Extracts X X X X X X X X Extracts X X X X
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