CX - Questions of law urged by appellant are purely factual - appeal dismissed: HC
By TIOL News Service
NEW DELHI, NOV 28, 2018: BASED upon the materials on record and the statements of various individuals including the proprietor, a SCN was issued alleging that the appellant had manufactured and clandestinely removed wires and cables without payment of any CEX duty.
The appellant denied the allegations and submitted – besides arguing that the diaries per se did not have any evidentiary value; that the materials on record nowhere justified an inference that clandestine removal has been resorted to. The appellant also produced other documents and materials including electricity consumption bills etc. to say that the activity carried on and the returns filed with the excise authorities did not warrant a finding of clandestine removal or attract a duty liability. It was urged that the bills and invoices seized and the statements made by the raw material suppliers in fact established that duty had been paid and that no liability, therefore, could arise.
The Commissioner rejected the submissions and confirmed the demand together with equal penalty. The amount of Rs.15 lacs deposited by the appellant was also appropriated.
The CESTAT too upheld the order by observing that - in the light of the evidences placed on record by the Revenue in the form of documents as well as various inculpatory statements, we are of the view that the allegation that the appellant has procured raw materials, manufactured wires and cables and cleared the same clandestinely without payment of duty stands established. Consequently, the demand of duty as well as the penalties imposed in the impugned order is upheld. The order for confiscation of seized goods also stands upheld.
The appellant is, therefore, before the Delhi High Court and submitsthat the Tribunal omitted to discuss the detailed evidence and merely placed its imprimatur on the findings of the Commissioner which is not expected of it; that, since the CESTAT did not apply its mind, its findings are perverse.
The High Court extracted the findings of the adjudicating authority and inter alia observed -
+ The statement of the proprietor Lalit Jain explained the process of manufacture and elaborated that with the help of machines installed 300 cable bundles of 90 metre coil each could be manufactured in eight hours. The Commissioner noted - in our opinion, correctly, that this itself established that the unit had the capacity to produce what was ultimately attributed to it.
+ As far as the facts related to the raw material and the other documents recovered from the appellant are concerned, the Commissioner noted that the statement of the one Vimal Taparia, Proprietor of M/s Ankur Plastics clearly admitted that he had made sales of PVC Compounds to the appellant without issuing invoices and without proper accounting.
+ No doubt, the CESTAT has not discussed the evidence as greatly as it normally does and is expected to. What is, however, evident - from a plain reading of paras 6 to 10 is that the main points, which ultimately led the Commissioner to impose penalty and also inflict duty liability were taken into account. It is, of course, desirable that the CESTAT as First Appellate Forum should discuss the evidence in some depth.
Concluding that upon a total analysis of the circumstances, especially the statements made by the various parties including the third parties i.e. the sellers of the raw material, the inference drawn by the Commissioner could not have been faulted, the questions of law urged by the appellant were held to be purely factual.
The appeals were dismissed.
(See 2018-TIOL-2473-HC-DEL-CX)
