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TMI Blog2023 (2) TMI 604X X X X Extracts X X X X X X X X Extracts X X X X ..... for the proportionate goods finally lost and is not liable to duty on the 25 CFC cartons of cigarettes recovered by the Police. The appellant is liable for duty only on the balance quantity of cigarettes being 138 CFC cigarettes. Further, penalty imposed under Rule 25 read with Section 11 AC on the appellant company and on the Director under Rule 26 of Central Excise Rules are set aside. Appeal allowed. - Excise Appeal No. 50187-50188 of 2021 with Excise Appeal No. 51252 of 2022 - FINAL ORDER Nos.50129-50131/2023 - Dated:- 2-2-2023 - MR. ANIL CHOUDHARY, MEMBER (JUDICIAL) Sh. A. K. Mishra, Advocate for the appellants Sh. Mahesh Bhardwaj, Authorised Representative for the respondent ORDER Heard the parties. 2. The issue involved in these appeals are whether the claim of remission has been rightly denied and whether the demand of duty has been rightly raised against the appellant company along with imposition of penalty on the Director. 3. The details are as follows:- Sl. No. Appeal No. Appellant Impugned Issue 1 E/21252/2022 (Appeal -1) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase in the light of the claims made by the appellant that the goods have been lost by way of burglary. He may ascertain the findings by the Police on the FIR lodged by the appellant to come to a conclusion whether the claim of burglary is to be accepted or not. Thereafter he should decide the claim of remission. The demand for duty if any will also be adjudicated by the Commissioner. Since the issue is long pending, the commissioner is directed to finalise this matter within a period of three months from the date of receipt of this order. 5. Pursuant to remand, the present impugned orders have been passed. Appeal No.E/51252/2022-SM (Remission matter) 6. The brief facts are that the appellant company are engaged in the manufacture of cigarettes and commenced their production activity in the month of August, 2010. Prior to this factory was lying closed for about six months. Thereafter, they stopped production w.e.f. 16.09.2010. The factory is under physical supervision by the Department, whereas Inspector of Central Excise is posted to monitor the production, movement of raw materials and finished goods, etc. On the date of closure of production i.e. 16.09.2010, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e factory. He came to know about the pilferage at around 11 a.m. when he received telephonic call from Shri Ashok Soan Kunwar, Inspector, Central Excise. Thereafter, he sent his employee, Shri Okesh Gaj Bhay to the factory. Shri Okesh Gaj Bhay on reaching the factory informed the Director about the theft. The Director also reached the factory at about 3.00 p.m. Thereafter, the Director along with the Inspector of Central Excise, Shri Ashok Soan Kunwar, Shri Lalit Kumar and Shri Okesh Gaj Bhay went to Mandideep Police Station and informed about the incident of theft to the Station House Officer, Shri Negi. The Station House Officer came and inspected the factory and thereafter, gave information of the incident to the SDO (Police). The Director of the appellant also gave information of incident of theft to the Superintendent of the Police, Raison and IG of Police, Raison. In his statement, he further stated that the Management has appointed one Security Guard, who was always deployed in the factory. The Security Guard also came to know about the theft around the time when the factory was visited by the Central Excise Inspector. Further stated, the goods were lying in the factory due ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rate, First Class, Bhopal that on the basis of information, they came to know one suspect Mr. Phool Singh Pal was interrogated, who informed that one Nafis from Mandideep has sent 25 cartons of Midland cigarettes for sale without any documents. Accordingly, 25 cartons of cigarettes were seized by the Police and kept in safe custody. The Police further stated that they tried to find Nafis, and Nafis informed that one Mr.Bhoora, resident of Rahul Nagar had given the said cigarettes, which had been given to one Mr. Phool Singh for sale. Further, Bhoora was interrogated by the Police, who informed that about 5-6 months earlier, he had worked in the factory of the appellant and also stated that 3-4 days prior to Deepawali, one person in the dress of guard along with three other persons had come and gave him 25 cartons of cigarettes for safe keeping, which they had taken back after 3 days. He does not know from where he brought the cigarettes and to whom it belonged. It was also informed that the Central Excise Department is investigating a case of clandestine removal against the appellant company since 29.10.2010 and the Excise Department have raised doubts (in its letter to Police da ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve suo moto in the application informed that cigarettes have been pilfered from their factory at Mandideep and they have lodged report of theft at Mandideep P.S including a copy of the complaint of theft through registered post. Further, Mandideep does not fall under the jurisdiction of the Court. Kotwali P.S. have seized the goods on suspicion and are further investigating. Hence, there is no requirement to give directions for separate investigation. Hence, the application of Mr. Anup Surjan, Director for investigation is rejected. 13. Thereafter, the appellant wrote a letter dated 23.11.2010 to IG Police, Hoshangabad complaining - not lodging of FIR by the SHO of Mandideep Police. Revenue issued show cause notice 2.5.2011 demanding duty of Rs.19,52,225/- including cess alleging clandestine removal of 163 CFC cigarettes containing 19,56,000 nos. of Midland FT brand cigarettes (69 mm.) and with further proposal to appropriate the amount of duty already deposit of equal amount on 30.10.2010. Further, penalty was proposed under Rule 25 read with Section 11 AC. Penalty was also proposed on the Director, Mr. Anup Surjan under Rule 26 of CER. 14. The show cause notice was adjudica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h ruling of this Tribunal in the case of Gupta Metal Sheets Vs. CCE, Gurgaon 2008 (232) ELT 796 (Tribunal-Delhi-LB), wherein it has been held that theft or dacoity cannot be called unavoidable accident within the meaning of Rule 49 of Central Excise Rules, 1944 and hence, no remission is allowable. 18. Subsequently, the Principal Commissioner, CGST Central Excise, Bhopal passed order-in-original dated 19.8.2020 in the remanded matter. Ld. Commissioner took notice of the directions given by this Tribunal remanding the matter, and also took notice of rejection of remission by order dated 22.05.2019. The ld. Commissioner had issued 2-3 notices for personal hearing. It appears that the notices have been sent to the factory address, which was lying closed since the year 2010, as the appellant are no longer existed there. Therefore, by ex parte order, the proposed demand was confirmed and appropriated. Further, amount of penalty was imposed both on the appellant company as well as on the Director. 19. Being aggrieved, the appellant s company and the Director are before this Tribunal. 20. Ld. Counsel, Mr. Anil Kumar Mishra, inter alia, urges that from the facts on record, it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ter dated 23.11.2010 to the IG Police, Hoshangabad for direction on the SHO, Mandideep PS. to lodge FIR and further investigate the matter. Ld. Counsel further urges that in spite of his earnest request , the Department did not issue any request or directions to the Police for investigating the complaint of theft. Further, in spite of information of recovery given of 25 CFC cigarettes, the Department did not take any steps to claim the goods and nor any further directions in the matter to the Police. 21. Ld. Counsel further urges in the facts and circumstances, the claim of the appellant that the goods were lost due to theft/burglary has not been found to be untrue. Further, the appellant have taken all the steps, it could take as a person of ordinary prudence, to get the matter investigated. Thus, no case of clandestine removal of the disputed goods is made out. The whole case of Revenue is simply based on assumptions and presumptions. It is further urged that in view of the Larger Bench ruling of this Tribunal, the appellant cannot get any relief in the remission matter. However, he urges that they are entitled to proportionate relief with regard to 25 CFC cigarettes cartons ..... X X X X Extracts X X X X X X X X Extracts X X X X
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