SERVICE TAX

CENTRAL EXCISE

2020-TIOL-1460-CESTAT-KOL

SN Plywood Industries Vs CCE & ST

CX - During search in factory premises of assessee, physical stock of raw materials and alleged finished goods was taken and it was found that there was no record of finished goods lying in stock as well as stock of raw materials in their factory cum office premises - Accordingly, same were seized along with private documents pertaining to manufacture and sale of finished goods and records pertaining to raw materials for the period 2010-11 to 2012-13 - The assessee applied for provisional release of seized goods and the same were released provisionally on payment of Cash Security Deposit of Rs.31,489/- vide GAR-& Challan and on execution of B-11 Bond covering the full value of seized goods - Since the goods were provisionally released, a redemption fine of Rs.31,489/- was imposed and it was appropriated from Security Deposit of Rs.31,489/- paid by assessee - A demand has been confirmed along with applicable interest and a penalty of equal amount has been imposed under Rule 25 of CER, 2002 - No investigation has been undertaken by Revenue towards procurement of additional raw materials clandestinely - No other corroborative documents have been produced - Investigations against the consignees have also not been done before raising demand on the allegation of clandestine clearance - The onus is definitely on the department to establish manufacture and clearance of such goods and also regarding the receipt of payments - In absence of such investigation and evidence, the demand of duty cannot sustain - Once the demand for duty payable is not sustained, there is no justification to impose penalty on assessee as well as on the partner - Accordingly, the impugned order is set aside: CESTAT

- Appeals allowed: KOLKATA CESTAT

CUSTOMS

2020-TIOL-1463-CESTAT-MUM

Mohammed Altaf Vs CC

Cus - Smuggling - Exported of consignment of Red sanders by replacing the original cargo of "Indian Hand Knotted Woollen Carpets" - Commissioner of Customs Nhava Sheva, vide impugned order confiscated 12.295 MT of Red Sanders valued at Rs.1.22 crores under Section 113 (d) (f) (g) (h) and (k); also imposed penalties of Rs.2 crores and Rs.25 Lakhs on Mohammed Altaf [then Assistant Commissioner of Marine & Preventive Wing of the Customs Preventive Commissionerate] and Ali Imran Saifulla Khan u/s 114(i) of the Customs Act 1962, respectively, the appellants - appeal filed before CESTAT - Main contention of the appellants is that the allegation is only based on statements of the appellants and other co-accused; the same are retracted; there is no corroborative evidence to confirm their Role in the smuggling of Red sanders - On the other hand, it is the department's stand that the appellants were the key persons in the smuggling of Red Sanders; they have accepted their role in their respective statements recorded under Section 108 of the Customs Act,1962 and rebuttal was an afterthought and hence not to be relied upon.

Held:

++ The statement records vividly the details which are likely to be known only to a person who has gone through the entire activity - The names of places where he met other conspirators, the dates and the manner are not sketchy but are elaborate - Mohammed Altaf has not only narrated his version of the story but has accessed the email which he used to operate to send the photographs of Red sanders to the other persons who are involved in the smuggling - It is difficult to believe that the officers of DRI could not have put at least this part of the story in the mouth of Shri Altaf - In the absence of any cogent reasons specified by Shri Mohammad Altaf to substantiate the willful action on the part of the officers of DRI, the retraction has been rightly held to be an afterthought by the Adjudicating Authority - It is not brought out as to why the investigating agency was particularly interested in fixing Shri Mohammad Altaf, more so, looking into the fact that he was a senior officer of the department - No personal enmity, if any, by the officers of DRI towards Shri Altaf was alleged - Insofar as the plea by the appellants that the CBI has not found any evidence to proceed against them and have not filed any FIR against them and, therefore, the proceedings against them under Customs Act also need to be discharged, Bench observes that proceedings under CrPC and proceedings under Customs Act, 1962 are on a different footing; that the standard of proof in a criminal proceeding is proof beyond doubt whereas in the adjudication proceedings, the standard of proof is preponderance of probability - facts of the present case are comparable to the one in S.N. Ojha - 2016-TIOL-20-HC-DEL-CUS where it is held by the Delhi High Court that the fact that in the criminal case the CBI charge sheet did not name the Appellant as an accused, that cannot by itself lead to the inference that in the adjudication proceedings, where the standard is of preponderance of probabilities, the Department has failed to establish its case - therefore, non-filing the charge sheet by CBI, ipso facto does not vitiate the proceedings under the Customs Act - role of Shri Mohammad Altaf has been established with a reasonable degree of evidence so as to establish the offence under Customs Act, 1962 in adjudication proceedings - Therefore, Bench upholds the penalty imposed on Shri Mohammad Altaf, under Section 114 (i) of Customs Act, 1962 - Shri Altaf is alleged to have invested Rs.50,00,000/- as per his own statement whereas Shri Meghani reported the same to be Rs.12,50,000/- and this goes to prove that Shri Mohammad Altaf has invested certain amount with a view to have pecuniary gain in the business - However, looking into the long legal proceedings that the appellant has undergone and looking into the investment made by the appellant in the smuggling of red sanders of 12.25 MT totally valued at 1.22 Crores, Bench is inclined to reduce the penalty to Rs.25,00,000/-: CESTAT

++ The other appellant Shri Ali Imran Shafiullah Khan, had a role in tampering with the seals and loading that container with red sanders with the help of Dilip (Deepak Joshi), Sheru, Nayan Singh (driver arranged by Sheru) and Arif - It has not been brought on record as to the amount of financial benefit that accrued to the appellant - Under the circumstances, penalty of Rs.25,00,000/- imposed on Shri Ali Imran Shafiullah Khan is on the higher side - While finding that the role played by Shri Khan is brought out with reasonable evidence, Bench is inclined to reduce the penalty to Rs.5,00,000/-: CESTAT [para 20, 21, 22, 23, 24, 26 to 28, 30]

- Appeal partly allowed: MUMBAI CESTAT

SL Saraf Impex Pvt Ltd Vs CC

Cus - The issue arises is, whether the benefit of Notfn 096/2008-Cus have been rightly denied to the assessee - The Commissioner (A) has dismissed the appeal on the ground of limitation observing that the normal limitation of sixty days ended on 22.02.2020, thus there was delay of 27 days from the date of limitation, although the same was within condonable period of thirty days - The order of Commissioner (A) have erred in dismissing the appeal on limitation vide the impugned order which is in violation of direction of Supreme court - Accordingly, the appeal is admitted for hearing on merits - The assessee urges that the Assistant Commissioner has misconstrued the provisions of law - If the facts of this case, it was not issue of certificate of origin retrospectively, as per facts on record the certificate of origin as required have been issued at the time of export of goods from the exporting country, and the same was presented for availing the exemption or concessional tariff along with the bill of entry - It was only on objection raised by Revenue, assessee approached the exporter /shipper who procured the rectified certificate of origin - Such rectified certificate of origin also contains reference to the original certificate of origin issued alongwith its number and date - The rejection of certificate of origin is bad as it was a case of minor discrepancy and was fit to be ignored in terms of Rule 18 of Duty Free Tariff Preference Scheme for the Least Developed Countries Rules, 2008 - Further, assessee had produced the rectified certificate of origin, which have been wrongly treated as issue of certificate retrospectively - Accordingly, certificates of origin submitted by assessee are in order - Therefore, assessee is held entitled to the benefit of exemption/ concessional tariff under Notfn 096/2008-Cus. - The impugned order is set aside: CESTAT

- Appeal allowed: DELHI CESTAT