2018 (9) TMI 451 – CESTAT HYDERABAD – TMI – Penalty u/r 26 of CER – Clandestine manufacture and removal – goods were removed without documents and without payment of duty – case of appellant is that they are not the manufacturers and the details of the manufacturers are given, whose statements were recorded by the authorities but no further investigation was taken up, that they are not liable to pay any duty nor penalized under rule 26 of Central Excise Rules, 2002.
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Held that:- There is no dispute as to the fact that fully manufactured fans packed in cartons were found in the godown premises of the appellant, consignment notes were issued for the consignments loaded in the trucks mentioning the name and the destination, appellant could not produce any invoice, way bills issued by the consignors or the manufacturers covering the material. Despite given an opportunity to produce the documents which would indicate that appropriate central excise duty has been paid on these fans, ap
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n-Appeal No. HYD-EXCUSMD- AP2-0011-17-18-CE and HYD-EXCUS-MD-AP2-0012-17-18-CE, dated 14.08.2017. 2. The relevant facts arise for consideration, after filtering out unnecessary details are the appellant herein is the transporter and he has various premises wherein he collects goods from various consignors and despatch the same to the consignees. The premises of the appellant was searched and found that there were eight truck loads of fans packed in cartons apart from the stocks, consignment notes were issued for the said fans mentioning the name and destination. On further investigation, it was noticed by the Officers that the said fans were, supposedly received from various manufacturers located in and around Gandhinagar, Balanagar and Jeedimetla and no invoice or way bills were issued by consignors covering the material. It was also noticed that the goods were manufactured and cleared clandestinely without documents and without payment of duty, the goods were detained and subsequentl
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l. 3. Ld. Consultant, after giving an overall picture of the issue involved submits that imposition of penalty under rule 26 of Central Excise Rules 2002 is incorrect. It is his submission that transporter is not the manufacturer of the brands of fans found loaded in the truck and no investigation was done to find out the manufacturers of the said goods supposedly cleared without payment of duty. It is his further submission that unless the goods are manufactured, liability of duty and imposition of penalty under rule 26 will not be arise. It is his submission that lower authorities have not considered the factual position as departmental officers investigated the so called manufacturers whose names, addresses and phone numbers were given by the appellant, but the authorities have simply recorded the statements which denied having manufactured the fans which were found in appellant premises. He would rely upon the following decisions seeking to set aside the penalty imposed under Rule
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ns made, I find that there is no dispute as to the fact that fully manufactured fans packed in cartons were found in the godown premises of the appellant, consignment notes were issued for the consignments loaded in the trucks mentioning the name and the destination, appellant could not produce any invoice, way bills issued by the consignors or the manufacturers covering the material. Despite given an opportunity to produce the documents which would indicate that appropriate central excise duty has been paid on these fans, appellant could not do so. On a specific query from the Bench as to whether he would like to substantiate the claim that the goods were manufactured and delivered to the appellant for despatches to destinations by any documents, it was informed that all documents which were there were already relied on in the show cause notice. I find that show cause notice itself directed the appellant to produce any documents while defending the case, as made in the show cause noti
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een from the above reproduced provisions that the same would apply directly in the case in hand, as appellant is the person who acquired the possession of goods and were concerned with depositing or keeping the fans on which admittedly duty liability was not discharged. In my view, appellant has no case for praying for setting aside the penalties imposed under rule 26. 7. It is to be seen from the records that the duty liability on the entire stock which were seized and confiscated is only ₹ 17,11,090/- while the penalty imposed on appellant is ₹ 10.00 lakhs. Considering it from any angle, the penalty imposed on the appellant seems to be excessive. Considering the fact that the duty liability is approximately ₹ 17.00 lakhs, while upholding the penalty imposed on the appellant, I modify the impugned order by fixing the penalty on appellant as ₹ 5.00 lakhs (Rupees five lakhs only), to that extent uphold the impugned order. 8. Impugned order is modified to that ext
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