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TMI Blog2019 (6) TMI 1273X X X X Extracts X X X X X X X X Extracts X X X X ..... consignee involving in the diversion of the goods. It is seen from the statements of Shri Anil Kataria dated 02.04.2004 that he was aware of the diversion of goods after clearance from the factory. It is also admitted position of the appellant that Shri Anil Kataria was their regular transporter. In the statements of Shri H.N. Bhatt dated 07.07.2004 he had reaffirmed that he has informed the representatives of appellant namely Shri Manmohan Agarwal about the diversion of goods and route. He also confirmed that Shri VK Sharma, was also aware of the facts. Another factor which is relevant is that during the short period of about 10 days they had cleared almost 100 consignments weighing 884 tonnes to one party. This fact itself should have raised alarm bells and doubts in appellant s organization. In any case, it was responsibility of appellant s to ensure delivery of goods - it is apparent that the appellants were aware of the diversion of goods en-route. Penalty upheld - appeal dismissed - decided against appellant. - EXCISE Appeal No. 557 of 2008-DB - A/ 11020 /2019 - Dated:- 25-6-2019 - MEMBER (JUDICIAL), MR. RAMESH NAIR MEMBER (TECHNICAL), MR. RAJU ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... signments, re-warehousing certificates have been issued by the Jurisdictional Range officers. An enquiry was extended to the appellant and it was revealed that during the period 27.04.2000 to 08.06.2000, the appellants have dispatched 100 consignments of POY weighing 8,84,281kgs involving Central Excise duty of ₹ 1,57,53,846/-. It was noticed that re-warehousing certificate in respect of 55 of these consignments involving duty of ₹ 88,41,894/- had been received by the appellant. However in respect of 45 consignments of POY sent by the appellant during the period 01/06/2000-08/06/2000 involving Central Excise duty of ₹ 69,11,952/-, no re-warehousing certificates were received. Consequently, demand of Central Excise duty was made under sub Rule 2 of Rule 156B, as amended by Rule 173N, of the erstwhile Central Excise Rules, 1944. Penalty was also sought to be imposed under Rule 25 of Central Excise Rules, 2002 and interest was also sought to be demanded under section 11AB of the Central Excise Act, 1944 in respect of 45 consignments wherein re-warehousing certificates were not received. 2.3 Ld. Counsel for the appellant pointed out that there was no invo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9.12.2004. In respect of the second Show Cause Notice, demand of the duty against appellant in respect of 45 consignments was confirmed along with interest and equal penalty. The third Show Cause Notice relating to the Cenvat Credit was dropped. The appellants came in appeal against the imposition of penalty in the first Show Cause Notice and confirmation of demand, interest and imposition of penalty in respect of second Show Cause Notice. 4.1 The impugned order was heard by tribunal. There was difference of opinion. In the order, recorded by Member (Judicial), the following was observed: 22. In view of the above discussions, we pass the following order: a) In show cause Notice no. V.Ch-54(15)23/R-V/D-Halol/Commnr/2004 dtd 19.9.2004, the imposition of penalty on M/s Modern is set aside and penalty on M/s Filatex is reduced to ₹ 1,00,000/-(Rupees one lac). The penalty imposed in Shri Puneet Rungta is upheld. b) In Show Cause Notice No. V.Ch.54(15)22/R.II-Mak/Commnr/2004 dtd 09.12.2004, the demand of duty alongwith interest and penalty on M/s Mondern and the penalty imposed on M/s Puneet Kumar Rungta are upheld. The pena ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... posed on M/s Modern Petrofils and M/s Filatex India are to be upheld as held by the Learned Member (Technical) (i) Whether the penalty imposed on Shri Abhinandan Kataria is to be set aside as held by the Learned Member (Judicial) or it is to be upheld as per order of the Learned Member (Technical). 4.1.3 It is seen that in the final order of Member (Technical) as well as the difference of opinion recorded, the Show Cause No. and date has been mentioned as V.Ch-54(15)23/R-V/D-Halol/Commnr/2004 dated 19.09.2004. It is seen that the Show Cause Notice is dated 09.12.2004 and not 19.09.2004. 4.2 Against the aforesaid difference of opinion, M/s Modern Petrofills approached Hon ble High Court. Hon ble High Court after examining the issue directed as follows: The impugned order of the Tribunal to the extent the same relates to the question of imposition of penalty on M/s Modern as recorded in the difference of opinion between the members is hereby quashed and set aside. The Tribunal is directed to hear the appeal afresh to the aforesaid limited extent without in any manner being influenced by any observations made by the Memb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... warehouse, duplicate to the consignor and retain the triplicate for his record. (vi) The officer in charge of the warehouse of destination shall countersign the application received by him and send it to the officer in charge of the factory or warehouse of removal. (vii) The consignee shall retain the duplicate application duly endorsed by the consignee for his record. 156B. Failure to receive re-warehousing certificate:- (i) In case the certificate of re-warehousing is not received back by the consignor within ninety days of the removal of the goods or such extended period as the Commissioner may allow to an assessee or class of assessees, the consignor shall pay the duty leviable on the consignment by a debit in his account number. Provided that where such duty has been paid and proof of rewarehousing is produced by the consignor to the satisfaction of the proper officer, such consignor shall on making an application to the proper officer, be entitled to a refund of the duty so paid. (ii) If the original application endorsed with the rewarehousing certificate is not received by the Officer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... latex and Shri V.K. Sharma are liable for penalty? Thus, it is seen that impugned order does not differentiate between the liability to penalty on appellant on account of slight difference in facts of first and second SCN. In one case re-warehousing certificates were not received whereas in others, they were received. It is seen that the impugned order deals with liability to penalty on a common standards. The impugned order observes as follows: In both cases, the transportation had been arranged by the consignors i.e. M/s. Modern and M/s. Filatex. While in case of M/s. Filatex the owners of the transport company could not be traced and therefore, no inquiry could be made, but in case of M/s Modem the owner/Manager of concerned transporters were traced. Shri Abhinandan Kataria, Manager of M/s. Vardhaman and Shri Harish Natwarlal Bhatt, Proprietor of M/s. Nirav in their statements dated 02-04-04 and 25-06-04 respectively have clearly admitted that the goods dispatched by M/s. Modern had been illicitly diverted from Golden Chokadi at Vadodara, that for this purpose, by a prior arrangement the partners of M/s. Resham used to receive the goods at Golden Cho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ned by the consignee and countersigned by the Jurisdictional Range officer/Sector officer have been received by the Range office having jurisdiction over M/s. Modern from which it is clear that the goods had not been delivered at the consignee s premises and this fact is more clear in case of eight consignments of POY dispatched by M/s. Modern to M/s. Resham on 08-06-2000, the day when the Customs officers from Mumbai accompanied by Central Excise officers of Vadodara were also present at the factory premises as no truck of POY dispatched by M/s. Modern to M/s. Resham on that day was seen at the factory premises or near the factory premises and there was absolutely no stock of yarn or any sign of any goods having been unloaded in the factory premises. It is being claimed by M/s. Modern that illicit diversion of the goods was taking place on account of connivance of the drivers of the transport companies with the partners of M/s. Resham for which M/s. Modern should not be penalised and the investigating officers have not recorded the drivers statements. Firstly this claim is unacceptable as no driver on his own will deliver and unload the goods at a place other than that mentioned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he appellants have also relied on the decision in the case of Santogen Textile Mill Ltd. 2007 (214) E.L.T. 386 (Tri Mumbai). It is seen that in the said case, the decision was without having referred to Rule 156A (3) which puts responsibility on delivery of goods on the consignor. Thus, the said decision is per incuriam as it has been passed without taking notice of Rule 156A(3). 4.6 From the facts of the case, it is apparent that the appellants were not careful enough and were willing party to the diversion of goods by the consignee. In this regard, the affidavit filed by the transporter regarding delivery of goods at the premise of M/s Resham Exports also appears to have been obtained without knowledge of the transporter. In this regard the observation of the Commissioner in the impugned order reproduced above becomes relevant. From the said observation, it is seen that Shri Abhinandan Kataria, Manager of M/s Vardhaman and Shri Harish Natwarlal Bhatt, Proprietor of M/s Nirav in their statements have admitted that goods cleared by M/s Modern have been illicitely diverted. It is also seen that these submissions are supported by the statements of Shri Bodu Gulam Shaikh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Resham, were delivering the goods at places other than the consignee s address as mentioned in the LRs, as per the provisions of Rule 106 of Evidence Act, the burden of proving this would be on him. Shri Kataria in course of recording of his statement has even not given the names such has not discharged the burden of proof. Shri Harish N. Bhatt of M/s Nirav has not retracted his statement. I, therefore, hold that both the transporters had full knowledge of the illicit diversion of the goods, in question, and both of them are liable for penalty under the provisions of Rule 26 of the of the Central excise Rules, 2002 (Rule 209 of the erstwhile Central Excise Rules, 1944) It is seen from the statements of Shri Anil Kataria dated 02.04.2004 that he was aware of the diversion of goods after clearance from the factory. It is also admitted position of the appellant that Shri Anil Kataria was their regular transporter. In the statements of Shri H.N. Bhatt dated 07.07.2004 he had reaffirmed that he has informed the representatives of appellant namely Shri Manmohan Agarwal about the diversion of goods and route. He also confirmed that Shri VK Sharma, was also aware of the fact ..... X X X X Extracts X X X X X X X X Extracts X X X X
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