9911796707
TMI Blog2024 (12) TMI 525X X X X Extracts X X X X X X X X Extracts X X X X ..... ise Law. Thus, it appears that Appellant has deliberately and consciously suppressed material fact as to manufacture and clearances of excisable goods, contravened the provisions of Central Excise Act, 1944 and Rules, all with intent to evade payment of Central Excise Duty. However, the facts on record do not support the case of the Department for suppression. It is found that based on books of account and records maintained by Appellants, Revenue has raised impugned demand of duty on goods manufactured and cleared. It is not disputed by the department on clearances of goods appellant also issued invoices showing appropriate VAT payment. This is not the case of the department is that appellant have not issued invoices during the disputed period. Appellants are also registered under the provisions of The Gujarat Value Added Tax Act, 2003, (VAT Act) and are assessee under the Income Tax Act, 1961 - It is not the case of the Revenue that appellants have indulged into clandestine manufacture and clearances of goods. When manufacture and clearances of goods and all other business transactions are duly recorded in the books of account and when books of account and other records are maint ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent of duty by the appellant s partnership firm as discussed, question of personal penalty upon the partner under Rule 26 does not arise. Moreover, it is settled in this jurisdictional High Court of Gujarat judgments in the case of COMMISSIONER OF CENTRAL EXCISE VERSUS JAI PRAKASH MOTWANI [ 2009 (1) TMI 501 - GUJARAT HIGH COURT] that in a case against partnership firm separate personal penalty on it s partner is not justified and hence not sustainable. Appeal disposed off. - MR. RAMESH NAIR, MEMBER (JUDICIAL) AND MR. RAJU, MEMBER (TECHNICAL) Shri A Banerjee, Advocate for the Appellant Shri Mihir G Rayka, Additional Commissioner (AR) for the Respondent ORDER Brief facts of the case are that on the basis of intelligence that Appellant were engaged in manufacture and clearances of excisable goods viz. Cable Trays of different kinds and were not paying Central Excise Duty on the same, a search was carried out by the officers and statement of Shri Satish K Nair and Shri P.K. Raghavan Nair, partner was recorded. From the investigation conducted, it appeared that Appellant had not paid Central Excise Duty on the goods manufactured and cleared by them. After allowing the benefit of cum-d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... willful misstatement cannot justify invoking larger period under the provisions of section 11A (4). Even if, for argument sake, it is held that there is suppression on the part of Appellants, however, mere failure to declare does not amount to mis-declaration or willful suppression and some positive act on the part of Assessee is required to be established. Mere inaction on the part of Assessee cannot be construed as willful suppression. He placed reliance on the following judgments:- Classic Marble Co. Pvt. Ltd. V. Union Of India (Guj.) 2014 (301) ELT 220 (GUJ.)- Helly Healthcare Pvt. Ltd. V. Commr. Of C. Ex., Ahmedabad 2013 (295) ELT 296 (TRI - AHMD.)- Commr. Of Cus. C. Ex., Hyderabad-Iv Vs. ITW Signode (India) Ltd. 2015 (322) ELT 699 (A.P.) Escorts Ltd. Vs. CCE- (2015) 9 SCC 109-A Commr. Of C. Ex., Ahmedabad V. Johnson Pumps (India) Ltd - 2013 (294) ELT 263 (TRI - AHMD.) Accurate Chemicals Industries V. Commr. Of C. Ex., Noida - 2014 (300) ELT 451 (TRI - DEL.) 2.2 He further submits that Revenue has not proved allegations with any positive evidences. It is cardinal principle that in a case of invocation of larger period, it is Revenue who has to prove suppression of facts with i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... each and every case of nonpayment of duty as per Department stand point would be visited with invocation of larger period irrespective of whether or not there is suppression and whether or not such suppression is with an intent to evade payment of duty. 2.4 He also submits that Appellant have not admitted on their free will as to the intention to evade payment of duty. There are no discussions or satisfaction or findings recorded in the impugned OIO establishing intention to evade payment of duty. Appellant had engaged consultants for VAT matters and for conducting tax audit u/s. 44AB of the IT Act and for income tax matters. Appellants have no knowledge of VAT or Income tax related matters. Had the appellant knowledge of VAT or income tax related matters, they would not have engaged consultants for these matters. Simply because appellants had engaged consultants for VAT and Income tax matters, it could not be assumed and alleged that appellants were having substantial knowledge of taxation matters including knowledge of excise duty matters. Appellants had not tried to gain any competitive advantage by saving excise duty component for their buyers. Appellant operate on very small ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stainable in the eyes of law. 2.7 He also submits that simply because assessee has not paid duty, penalty u/s. 11AC(1)(c) could not be straight away imposed. Penalty u/s.11AC(1)(c) is not automatic. Whether or not penalty is imposable depends upon the facts and circumstances of each case. In a case where non-payment of duty is not out of any malafide intention or because of any deliberate act on the part of assessee with intention to evade payment of duty, there is no justification for imposition of penalty. Mere prescription by law for levy of penalty does not mean penalty could be imposed automatically. Governing facts and circumstances with cogent evidences should suggest that penalty is imposable u/s.11AC(1)(c). In the given case, it is established beyond any doubt that non-payment of duty is not intentional, but, bona fide act on the part of appellant. Revenue has not proved charge of suppression with intention to evade payment of duty. Revenue has not recorded any cogent findings or given reasons in the impugned OIO justifying imposition of penalty. He placed reliance on the following judgments. Commr. Of C. Ex., Chennai-Iii Vs. Supreme Industries Ltd. 2014 (303) ELT 513 (Mad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the GVAT Act and declaring therein the value of clearances and sale of goods manufactured during the period in dispute. Assessment under the IT Act and GVAT Act are also made by the authorities. Appellants are also procuring various inputs required for the manufacture of goods in question. All the clearances and sale on goods are under the issue of proper sales invoices. If there is intention to suppress any fact with an intent to evade payment of tax, Appellants would not have issued invoices and they would have issued the invoices declaring suppressed value of the goods manufactured and cleared and would have suppressed and mis-declared the value realized from goods manufactured and cleared in the books of account maintained. This factual position is also not disputed by Revenue. Purchases and receipts of inputs are also under the proper invoices, challans etc. issued by the suppliers. It is not the case of the Revenue that appellants have indulged into clandestine manufacture and clearances of goods. When manufacture and clearances of goods and all other business transactions are duly recorded in the books of account and when books of account and other records are maintained by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... account for in their books of account and department during the investigation also admitted the said facts. Therefore, the entire activity of appellant is very much on record. Appellant also disclosed the said transaction in their Balance Sheet. At this juncture, it will be beneficial to take note of the decision of the Hon ble Supreme Court in Uniworth Textiles Ltd. v. Commissioner of Central Excise, Raipur [2013 (288) E.L.T. 161 (S.C.)] wherein the Hon ble Supreme Court held that every non-payment/non-levy of duty does not attract extended period and there must be deliberate default. Further, it was held that the conclusion that mere non-payment of duties is not equivalent to collusion or wilful misstatement or suppression of fact is untenable as the Act contemplates a positive action which betrays a negative intent of wilful default. Further, in Pushpam Pharmaceuticals Co. v. CCE [1995 (75) E.L.T. 721 (S.C.)] it was held that misstatement or suppression of fact must be wilful since the word wilful precedes the words misstatement or suppression of fact which means with an intent to evade duty. 4.6 Considering the above facts, no suppression or mis-declaration can be attributed t ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
