Rajesh Mittal v. Commissioner of Central Excise

SANJIV KHANNA, J. w,*r.

R.V.EASWAR, J. Pagelofl' CEAC44/207L Certify that the digital file and physical file have been compared and the digital data is as per the physical file and no page is missing. $-7 to 9, '16 B, :k [[v T'[-{E ,, CEAC SUNIL F{[G[-[ C{3ulR-tr 0l: llate :/, -7I I + Aqtzot t I tvllrTTAL-I nrou.qn lVls.Seema nltvts.bavtla "t\ VCTSUS COMI\/IISSIONER OF CENTRAL E)t;;t : Tlrrough lVlr.l(arnal Nijhaq;va . Cclunsel with lVli.S CEAC 45t,,2011 RAJESH IVIITTAL , : Througlr N/is.Seema lVls.Savita versu$ ll:i COMMISSIONER OF CENTRAL E)(;|DI ' Througl-r IVlr.l(amal Nijha!,va i,i:,: i' 1I; ! RES & COI\DUCTOR{iI :I . 'i. '1, t l, t t'l t I i I, I I I l att! I I' { i' 46t201 FIQ WI : & 46/201 : i : CEAC TANIS 42,44,45 o + CEAC 41, vl : I II t l. Jainiw }-rll'l(-'l -'l rJ.r, 'J,,l L .l il.f Counsel with I\/h'.S [\llH\ f li)li:[,-li-illl . 9tr' l:.\pril, 2.01,:1. ..... Peti'tioner l\/lr./\iarf l'r..,.f ain il VS. E ..... Rr=rs;condr;1n1. , Sr.Standirrg mit Giaur, /\du. lf,eti'i.inrter K.,.lain {i, E .-... Respondernl. , Sr.Stancling rnit Gaur, /\clv. EXCISE ..... P';ttilioner PaHe X (ll'it!:; \,,' !r Tlrrough VETSUS l\/ls.Seema l\/ls.savita tlr Mlr.r\ery l'i.,-f;eirr {,i' Sirrr\lr, .l .l ,l t! rl ti \/5. CON/IMISSIONER OF CENTRAL EXC E ..... R.ee;rrc,ndent ' ' Through N/lr.Kamal Nijhajw ,. .i n , Sr.SitanrJirrg umit GaLtr, /-\cJv. Counsel with lV:"r. CEAC 4,1t2011 DINESH:KUMAR GUPTA . Through lVls.Seema [\/ls SaVita clvs. E ..... Rel;porrdent n , Sr.Standirrg mit Gaur, /\clv. + /..- CEAC 421201'1 i ,/: i t ../ \-'/ NATRAJipmsr INDL,STRIES lrnit Througlr IVls.Seema l\/ls.Savita P<,:lii:ir:rriet K.,Jaitt li E ..... Res;prorrdenl , Sr.StarrdinE mit Gaur', /-\r:lv. Page 2 of 11.5 cEAc 41, 42, 44, 4s & 46/20:.]: i. ,i H () hl' E3 iiE [Vl Fq,. J {"nsT'i (] lu {3AI\,1"J ll\/ : ( I fl-il()t\x'E3uH [MFq. J LnST',[{:E WJ.LKIMI=l I I These appeals under Sections 35'3 Act, 1944("A6t" for short) aris;e out of er ico 'l the Customs flxcise and Service Tax Apliel i in shorl) dated 4th July, 2-Ct11. ,As tllc. ia ,l issues raised i are interconnected, we ' cl t: examine the isbues and contentions raiseC i 'i i

¶2Appeal \o.4212011 filed by the Niitr for the sal<e oficonvenience arrd with tlre ':o the parti6s, is trbated as the lead case. tion of tlre appellanL is',th pa5sed by tlre Tribunal lrolcling that tl-rere of resin CP172SG by Nlatraj Plast Inclus;

768.03 h/t is pbrverse. The l-ribunal hasivy --'l | | I '' reriorded tlrat 768.03 N/lt of resin was so d Aditya Plastics, sole proprietorship of tV,r. Mukesh Industiies, sole proprietorslrip ol. ./r cEAc 41, 4.2,44,4s &46120rl

¶3The conten L NNq,A of tlrer Cerrtral llxcise mon clrder pras;srlrJ kry le Triburral ("Tribunal" ts are similar arrd l.he ern it ap6rroprial:e ir:r this comrnon orcje,r. F'lasl: Indri$tric-:'s l-,|:d., senI of tlre cr:unsel lnr the impugnerci orcler W s clancie:stine rernovell s Ltd. i.o i:fre er>cl.eni: ()l ngly and erronrlorr:;llr nd ltru,'',*porl:r:cJ to l\/l/:; a.jesh Miltal arrr1 l\/l/s Surril l\/litial. Page 3 ol ll.5

¶4Learned icounsel 'ior the appellerrlt:ia there was clandestine removal and saiie ; ,:rl to AcjiLy;i .; Industries br-rt lit is subrnitted tlrat the ciu .rl Tribunal is ba$ed upon surmises and cc',1 ll 'i r' concrete eviddnce or materierl to hold ilh ti CF'172SG wasiclanrJestinely sold. i ;',

¶5Resin CP172ttsg is manufacturecl 2V .i namely M/s Clierniplast Sarrmar Ltd. Thbr r<<' ^. '. : -. : )\. appellant, Natraj Plerst Indus;tries l_td., hal; p of the aforesaid resin from tVl/s Chernipla'rt period 1111P-q01 to 1tll2l20}6. On fitrt I conducted in fhu premises o1' Natre4 F]l'a ' startement of Dines;h Kumar Gupter, orye .: recordecl. lleiadmittecl to clanciestlne r,;ni ; "'- ',i" CF,'l72SG. M,r.Dinesli l(umar Gupta ini tr stated that he' had parily .used and coit,s manufacture cif Filler Corcis. In a u,. claimed that Resin Cp172SG *u, ulro ,i',u, I PVC Tapes. In the staterments nrade ofi tJi ,i .; trupta had nei,ler claimed or stated'tha.t 'i,e l!, used for mbnufarcture cif pVC c,, ffi contention/stiarid was raisecl for the first iim CEAC 41, 42,44,45 & 46/2}lt I '1 'l t. and aclmil.s i:lreli: resin CP172i3Ci bV lastics arrd lVlul<,esh ity computed [r'y Lhe: ures ancl tlrerr* is rro

768.03 l\4'i. or rr;:sirr ne cc)rnparry irr lrrdiel. is no clisputer i:hi,lt i:h,;r rchased I 10:l .-l 15 l\/l"f anmar L.td. clurinq i.lrc: 006, a seelrcl"r \ffa$ t lrrdus;tries L.tri. ,:,lnd the Direrctor*, \/tfilsi val and si:le oi' rr:lsirr staLemerrt harJ ialsr: med i:he ros;in in thr,: queni. si:a'l:ernent, hr,l in the manufaclrrre: cil' ii: cla[es, N/lr. [)irresl-r n CP172SG war; ;al:;o und. l"he said clurirrgl the coursi+ of Pa13e 4 rrl'L5 i I the assessnren! proc;eedings. saici aspect used in tlre reasoning:- CEAC.41, 42,44,45 & 45/2)tt nas rejecle0 tn€) iif rnanufacturer of

22.09.200p, 3t.10.2006, 7.11.200/],

10.11.200,6 of .Shri Dinesh Gup{:e"' Nal:rai, reQOrded uncler Section 1l oii tt Act, 194.4i none of which have beenlre his s.tatement dated 14.02.2006, $h, stated thd,t they were manufacturingi,'or PVC Coryrpound in which they ii,re flexibility gf thet conlpoutld by chanpir stabilizer ietc. and that in the mltnt Contpoun',! thelr were using Resi,bs ii TTA'rrare/ne nr oated 14.02.2006. 14.0i1 1,5.06.200,6, 23.06.20A6, 3.9.2;i manufactUred by lV/s. Reliance, S;l ' dnd M/s. iFinolex to the extent of il6 CP 172 EG procurcd by them fromi being use)d in the manufacture ofP\,,'C it was bging added'trs the e>cten,; surplus auantity ctf CP 172 Sr:] manufacture of the PVC Filler Corci, the manufacturers of. baftery sepeira invoice or bills and that he was doin't condition jwas not good, in the subp dated 28.'08.2006 and 22.09.2006, ttie , that in addition to ntanufacturer of il?V LrtaL rtt auturLtwtt Lv Iudtlutd\,Lutyl ul I1i..v 17?- S.G Resin was also being t,sediin of P.VC lapers to the extent of Sii quantity of PVC Tapes using CP17i?S to have b'een manufactuied is onlv,-''11 J:\ L rile clealing witlr ther esin ClFr'l ZZ.SCi vrras' giving lhe follrrurirrcl 06, 28.04 ?_006, , 2_8.08.2006,

8.11 .2006 ar)a' irector ,cf lV'i/s;. Central E.xcis;e ted. l/Vhilet in Dinesh Gctpl:er Y a Single T1,,Pe changing the the cyuantity of 'acturc+ of FVC.: of 67'01 gracle Rant Industries; , ther[ the Re.sin . Cantplast vras iller Cortl tuheret 25% and thal. sin left aiter s be>ina solcl {:ct rs 'wif hout arl)l as his financiaf uent t:tatentents owe\/er, clainted Filler Cord, O[) the ntanufacture,: Howevet', thc; Resir Claimed 31 l\/lTs in whiclt t,age 5 o[ I.5 o. had the use o

230.80 Mt be to the indicates i diverted.":, Apart fro;n the: rt :-\ 6701 was used .; restn was purcl-l companies. M them, was rrot recorded and, manufacture.

¶7The aforesa consumption fo records/books. cEAc 41, 42, 44,45 & 46/201,L ;l f CP 172 SG Resrn wouiU , .:i IT only and total use of'J,r, i,i . ;llut the bulk o! the quan'pi1 ir il' t. fact that Vtr. Oinurt'.ri.'C , never clbirnerj that lre has us[! manufacture oflPVC compound, flre Tribr-in tlre manufacture of P'Z asecj by the Natraj Plast :i loreover. it t'i.. l. was Tor l\ittral show and estatStisfr that the re:sin 6T01, pr,t. r [herefore, resin CP172S,P iThe Triburnal has referret,l single type ancl as pler the r'inrJings r".orll1 I 6701 was used for rnahufacture o.f flre sail6 to the tune ol'' 172 SG Resffr b1r thent, tufticlt has been illictitll,,r pta in l-ris stili:ernr:,'nts resin CrP17'2S;G l'or has noticed that resin . compound. The tali,l ustries Ltd. frorrr thre,l last Industries l-td. tr: red ancl purchasecl by P\iC compound as asi used in tfre :';irir,l P\iC corrrpourrcl abl by thr: 'l-ribunal, rr.:sin orrpound. \/Vei do rrc,i: on thr=r s;aid ia:sg.rclc:t or h a;s heren ca: lcr..l l;ei,ed purchals;ed, lerss i:he a$ re)cordeld ilr ihr: efit of cJourLrL i.r:l i-lre Page 6 of L5 .including fs use in the mantrfacture"i),of iller C:ord tuoulcl itune of .334..8 MT only asi) inst the quantit.rl of 1 1 12.405 MT o'f Resin purch find any error in the firrdings by ilre Tribffia .ti anv reason to hold that tl-re firrdinq is penrr$rs g is penrr-i or no1. jusl.ified. :r ;said quarrtunr, i.e. 768.03.i/|t :11 rilo by the Tribunal on the basis of flre qrutiitit r procluc;tion of PVC cc,r'plbu The Tribunal has giverrlb ,l l{ i' I 4,. I l*iir i[, :l' Ir' 'fr' .ri , ,: i ',1, .t; ,i'r ,,:; ;v :i ."i ,,1, ', l : '{ t 'l ;!l 'lj,,'l !l ..,| ij Ptart Inclustries Ltd. and;iot .l of resin CP172pG irr the manufacture o1'lf\/ 'i1l of 230 N/lt. Thq rea$ons given by tlre Tr,br-r 'r'i 'l reproduced.- ' I ,lrl i :i! "5.1 Durirlg the period front 1.11.2,,)0 Natraj ha'! purchased 1102.715 Mi c front M/siChernplast Santmar and llac credit in r,espect of tni" quantity. Cl1,tt of 1Q4.01': MT in the ntanufacture oti F been accepted by the depaft:meltt departmeint the beilahce of 98.705:;i w ri CEAC 41_, 42,44,.45 & 4,6/20Lr resin hasi been illicitly diverted. T;!e the manufacture of PVC compoun:,l clainted 6y Shri Dinesh Gupta anb .use onlyt,in the manufacture of P\h; tape. Bttt totdtl PVC tape manufeu:et during th'e period of dispute is 4,!2. during 20,03-0,4 + 210.12.7 IWT durr';1g MT during 2005-06), in the ntanuft!:ct rate af 56,%, only 2-30.72MT of CP be used,, w[tbh leaves 768.03i, unaccounted, The departntent's aligg report ofi CIPET, Lucknow in respt',ct tape ma.nufactured by lw/s Na:ya1 investigat!ng officers b1r using CP{7 ext'ent c>f 156% is that CP172 SG re$rn in the 'manufactnre of PVC ta,:)e Motherso'n Sunta Sysfenls and i,: elongation, tensile st'rengtl't, tear s; of the t, sample of lhe PVC fiLl Motherso'n Sotnu, which are cldri manufaclyred by using CPlT'Z Stf er applc;llani:s on use Tape:s 1:o the e*xternL al in i:his reggarcl arrr: to 14 '/- ?-()Ofi ll(is CP-17'2t;G rc+:,;in availed t:he central f this quarftity use \/C Filler Cord ltas' and erccording tct T'of CP - 1725L:) se of lfiis reslt iri as not et/en been e has clainted iis' ller cord and P\iC: red by l\/l/s l\lal.:raj

4.9MT (1 .:31,t, ll/i]- 2404-05 4-200.7'08 re of uuhiclt i'tl: ,ifte 72-SG resin could T of resin still tion based ctn it;,s[: of sarnple of P\/C': in presenc.:e ()1" 5G resin to ihe, as nctt been ut;eci supplied to [\,/i/si r buyers, as ihe, gth and shrintrreryet suptrtlied l'(l l\/l/st d to have been sin are clifferent:. Palge 7 rrl ll5 t/ Ilants; Plea t'hai , tensile str,'engtlt ' ntanufacl:ured in pe supltlied tct l\/l/:; case of P\/C f.;tor; r and 0.3mnt in thersort {}umo; resin, plastici;:c'r, d difference in the> as /reen extruded: while CIPET ha:.; gth and elongailion STM|DB\S2-rrtethctcl nhouse Laboralonr aint af il/l/s hlefl:rel G resin in the uset to be given the rd to 768.03 lVl'|" of Iegat:ion tltat i/rr,r sfrcncy footing anrl therefore, havc+ tt.r cenvat credil: takr:n ce this Quantit.yr ctf fraudulent t)tailfli: , for recoven/ of r lintiiation prx'ioct' ntral Excist> /\ct. rtntent ancl for thet ') of Cenvat Credii I'age B ol'35 :;l lj :i i:, But on tfiis point we agree with thl= this diffe'fence in elongation, shrir,i.ka and teai strengtl't of the PVC iep r. - ., - presence of the officers and the pV::C Mothersqn Sunto rnq/ be due to :- i 'l

(a)Difference in thickness 0.4ntnt lile rl t I i rnanufa,ctured in the presence oii. o case oflPVC tape supplied t,o Uh'iy,

(b)'Attinor bhangye in ratio of Cp 17:t?s filler, stabilize and ntaster batch:ar tt,'ltemperatur€ at which the produtt , emdi i

(c) Difference in the ntethocl of tesiinl fesfed the tensite strbngth, tear slre by ASTMDBB2, ASTtWb i ooq ur:a respecilvely, the ntethod adoptect .by ctf lV/s l/lotherson Sontu is not knc:wr ,1 ln view:,of the above, so far as f/r'e regarcling use of ,Z30.T2M|T of Cp ,7i of PVCitape is concerned, they t11s benefit bf,doubt. .However, with rltgt CP1725,G resin, the departnteniii same h?d bercn illicifly diveftecl r,rio, me same is upheld., lV/s Natraj ;vil pay along with int:erest the antourlt; o.l on 768.Q3 Mt of CpjT2SG r-esrir iS, I restn has blefl illiciily diverted 'rity without i reve'rsing th; cenvat c/,id cenvat 'gredit on this quantity, lc!'ng under p,roviso to Section 11 A (,;) , . 1994 wbuld be available to the 'd'ppi same reason penalty under Rule i1S( t : CEAC 41, 42, 44, 45 & 46/201,t Ru/es, ?q04 reac{ vvith Section 1 i/\ Act, ruoltld be imposable on Ml/s l\l.ptr - confiscution I .i1 res;pect of this illicitly divr=rtecJ resin, ce,nvait taken. Sinr:e Na1.rj Plasi Industries I conductors Pul Ltd. and Sh. Sunil l\/littrl dealt witl-r ther illicitly cJivertecl resin knowir,g I \, was liable for confis;cation, they u/ere liatlle 26 of Central Excise Rules, ZC)02. Tribun:rl, findings, has upheld imposition of penaltyi,: Central llxcise iRules, ZO0Z.

¶9Learned counsei for the appellarrt lne I Plast Industries Ltd. ancl Tanishcl Wiresi] limited c;ompanies incorporated uncler Cjo therefore, no p'eqalty carr be irnposu.l on,i1l., Central Excisei Ruler 2002. lt is submitte.l ial cannot be attributecl wittr requisitr= mensl".3a the Ruler is that flre person should ha{e with reason to believe, that il-re goocts i,a under the Act or these Fir-rles. VVe clo rrc,il r.i /, i\i L I, '. t.. r'l .: 'i. i 'l'Ilt t.I' I t-t,r t! I i,l,t .t', i: I . il r t,'lr' t:. t. I t.: JI , 'i B. Urrder Rr;le 1{i(1) of Cerr '. capital goods, iin rersper:t of vr wrongly, are liqble fr:r confiscat nvat Credit.iRr which celv,pt rtion. ln thi'i; c cEAc 41, 42, 44, 4s & 46/zo1,t Y t ot' Cenl:ral /:;rcl'scl les, 2004., any irrpui. or redit has l-reren till<en se, the illicitly diverted underilris Ruler. ars in redit had beerr vvrongly , -fernisl-rq \/\fire::l ,li nd Fiaiesh \/litial had wr:ll ilral thr,: :3l11'y1i:' r penali:y uriclerr l:?ule fter rerc;c'rdirrl; 'the said them lrnrjer Fiuler 2-'.6 r.rl' subrritterl tlra[ [',lerl.rai onductors Pvt. l_i:d. elrer panies /\ci:, 19litj ;errr:J, m under Rllle 26 nt i:fre ial [he said cclntpilnies and the requireine,''n't of nowlerdge or atl.ribui:r,:cl liakrle'for confiscai:iorr d anlr nrerit irr the sriicl Page 9 of 11.5 ; : contention und thu bame has hreen , decision of tlrg Supreme Court in f\gar .l and Or:s v. lAssisfanf Co,f/q-"ctot uf Ci;rs '1,: E.[-,T. tr'46V S0/ in Whir;lr it has been lrelclr'- ) ,I\ . i' "-tr-lle sQcond contention that bec',tu I'legal en,ttty, it cannot be a persotl ut ' - s -" - ":'-r "", 1,, Sectionil6T(s), (B) and (3tT) of thl;t equall.lr iuntenable. There is of rj.c 'person'iin either of these,Acfs buti,ilt 2 (42-) of the General C/auses Act ,!'B the Act'of 'l 1768 tnrould be applici.lctt nt : . botlt of which 'person' has been cjltfi company or as.sociatic)n or boclyioi vvt t,l\JLtt tl \)r ct\>\>vwtaLIL|l I tJI uvu)/ I, ul incorporgted or not. lt is of court,;e definitioit dolrs not appty to a firnti w person Vnd has no legal existencb,

(S) and,,(37) of sc.cfio n '167 of tnd\ S inapplicable to the appetlant firtl. explanation to section 23C i.'e contentibn. ln that a compan.y fc\,y t secfiorr irs defined, to mean an\;,i' L includes, a finn or otfter a,ssociatiit,\n Directoriin relation to a finn rneari; The Higf Court was ctearty righ[ ifi, n found that there has been a-cond:av provisions of the foreign Exchangie with Sea Customs Act lsy A firrn, tfi,r: in-chargg of ffs business oi ar!", conduct':, of the sarne, cannot umllp, proved Qy theff! that the contreveniti;,;sn .rl' ,a' \ CEAC 41, 42, 44, 45 & 46/2O1.t )y ' rejected in r,,i6xny nf l:he 'tr-na cl; X n g Cnt 16r o n,eiti <t nt s, CTdnlau[:ta ( 'fl9t33 e the firm is: nol: a in the meaning cfi' a Custours /lc;f. is , t'to definition of definition in sec;tion 7, or section ,2 (il) of to the s:aid l\cts irt ed as including anyr individual, vrhetther contended that f:hirs ich is not a natural s suc/r claus;es (i:l), a Custonts r\,ct are In c)Ltr view. the 'y negatives ihis purposes of l:h;et )/ corporate and individuetls ancf ,a partner in tlte i'inn. ding that rsnce it is ntion of any of ihe egulatiot't ,L\ct read rtners of it tnrho are sponsible fc,r the Iiability, uriless if ls ook place witltctut l)agc t0 o[:f.:; their kn,ortrrledge ,ar the exercise:i:J . preventt,such contravention." :

10.. We may ialso rrote that ar similar corlte :: l j ^o , :i $upreme Coqrt in St,andard Chartef, ,.i,.i Diyectorate af, Enforcernent and Ars" :l t marjority view.. eluciclated that a conlpan\, c punished for an oftence uncler Section, Exchange Reg.ulation Act, 1gTZ, even fl^,ou term of not less than six months was cotr:rp thert Iegislative iintent to lrroser:ulte corpor,:rr" committed by ithem is clear and e><plic,.t intended to e><onerrate them from bein Legislatr-tre never irrtenclecl to give imnrrlni penalty for grarie ecrlnomic crinres. In su.;h t-to iinpos;e ;:enalty of irnprisonnrent bec'Frr_ !. porporate body ahd noi a natural persor,, ib lr i i,, resaid legal pc,sitlorr :' rvy arises r:n tlre s;'lid i: rn raised bv trre aipp I riclr has been imilo: t. ,/littal. lt is surbmiti'ecl i I '; i J ,t ii, -lil, I'I i: i :'; t. 'li'li 'l i:' Ir ,,,. : ,; Oan be irnposed i '11. In view o;f tf.r" aforr substantial cluestion of lar, .t 1't\' :

¶12The third icontentior : fine Rs. 5 lacsi each whi : Sunil Mittal and'Rajesh I\/l , : CEAC 41, 42, 44, 45 & 46/20t1, i : J)/ due diligenci: io icin was raisrld br:for,: hanlj't andl 6\rr:s- \l/

i) it'/{i IIT'liR f il. '['hr": n be prosecuterd anrJ 1) (i) of the Fr:rreigrr h imprris;onnrent 'fqLr it sory. li: vyers also hekJ bodies for tlrr: c,flernr:r,r nd the startul.r-:' nevelr prosecul:er:J. 'l"l'rr:,r fronr proseclr[ir.in r-rr es it is noi: pcissiLrlr,t e the company is ,iA t fine or-c;,rsh ;:relnr.lltlr we clo not i:hinl< anlr aspec;t. llani is vvith rerg;arrJ i:r:r utrder llule 26 orr hat tl-re aforersaicl finr,r t,age 1.1. of ll.!i t Tribunal was nrr[: i'lble G clandesl.irioltrr derall. nol find a;nv rnr*rii. in ne renroval, 'i.hrlre is ime o'i searr;h irr f:hcl l, resirr CP'17;llSG stries [-1d. was found. gs rerc;crrcler:l by l:ltc,: , while cleintingy 1 72 SC; Resir r VC Fillet' Corci antitv had beert nvat credit ant-l 72 SG resin hacf of A/l/s. . /-\diiyr,-t h lndustries anc.f b. lVlicro ,Sec: lt l\/lii:ial oi' l\/l/s;. tvere purchasinry Chernplast anrl under tn\/orces, anufactures; c,f sa/?rc+ tuitftout front lVl/s. [\l eil:reei y invctices. Shri tatentent detecl ing l:he CP 17:,! t and also fron"t 'of iVl/s. lVlicrcr Pagc L2 of L5 ,i :l''l' ;1, imposecl r-rnden Ruler 26 is not jurstified as'fthr :l to quantify the;eX?ct querirtity r:f resin CP);72 with or transpqrted/sold etc. to thern. VVL c ther said conterition. In sucfr cases of ctai'oo ,1" always an eleinent of estimation. At tij:re ,pr.emises of Sunii IVlittal ancl Raiesh i tV '1. procured ancl purchased by Nlatraj Plast lrid r ri It ts appropripte to reproduce the fi,lidil t( Tribunal:- l" "Shri Dihesh Gupta in his staterni,:nt the usei. of certain quantitlr of i"Cl: purchased by hint for ntanufacturei.cf PVC Tap,es admifted that substantitit c, so/d as Such without reversing iltti' C ' that somb of the parties to whont Cl= ' been sold i were Shri Rajesh Mil,tal t. plastics, ghri Sunil lVlittal of M/s. Mtlke, Shri Rajgi,h .Bansal, Proprieiar .if Industries. I On inquiry with Shri ft,rye Aditya Plasfics, it was founcl that thl:zy CP 172i SG Re.srrr directly ,ro,r, ltll"l/s that the qu'antity was being sold,n,l'ui{ ' but for qupply of this resin to i/ie battery separators, who lvanted I,th, invoices,'ithey were pracuring this rd,,vir, who wasisupplying the same wit:holt a Sunil A/littal of llrl/s. Mukesh in /rlis

7.7.2006',admitted that he was puri,.he Sg Resii liregtly front A/t/s. Cheni;,1,,la M/s Natraj 'Shri Rajesh Bansal, pro,]'rie : l'u i,; i L cEAC 41, 42, 44, 45 & 4.6/2011 ,i;, 't; t.: ii :i; .t, l;, f l I v adntitied ihal he ttery Separef:ors 172 SG Reisl'i sed c/ri'ec;tl.y I'rct rn ntial quantil:y had nt l\/l/.s. l\leftraj urse of search cti

14.02.2006, 10t] o. 369 had heen sin oi' the sernt: mplast to l\/l/s whiclt indicetted seized 'from the come f'ram llUs. 172 SG r€rsin c,f . Chentpla.st. ln rse of search ctf s of C)P 1T?_ SG) d 41/i had been st it vvas found ctured in therr rJ, from vthere ir depot at Delhi .01 .2006 enrl of CP 'l'i2-SG M/s. Chernplasf: Sri'ice ather than nufaciure of C[2 tock of 17'2 ,SCi s unaccot-tntecl. e ntentioned C[::) 10,4.1 'l and 4'l,tl. du anrJ sfcrc/r d blr ll4/s. f{etraj, Parge L:t of 15 Sec ri hls sfafe ntent clated 3.7.20jG was enggged in the nanufacture ai E 'for which, prindpd raw material igl C and that ,while same hacl been'pui,fh, M/s. Ctte'm pl a:;t uncle r invoices,'suhjsfr been purchased without any invoice 1s I tl )t\"l1.6 lt Was also found that while,ir,lct the prentises of lV/s. Aditya Plastics.jor bags of CP 1'f 2 SG Resin of Batcrl l\ recovered, 14,3 bags of CP 172 SCI F batch ha),A been iurtptied bv Mt/s.l C Natraj under invoice date 30.12.2C.At that '100'.bags; of CP 172-SG Re.rrrn premisesi of M/s. Aditya Plastics.ilaa Natraj, as there wets no purchase ol C Batch Ne.369 lty IVI/s. Aditya from ,:M/ ca.se of M/s. [Wulcesh lndustries, in co their premises on 14.02.20A0, 520:.5a Resrn of ':Batclt hlo.408,409,41A,4'1,,i a .- fotrnd. On inquiry witlt lw/s. tlhenTpl that f/rese beftches had been nii::.n1, manufact,uring unit at Salem, Tant,;' r, the sarne had been transferred to;the ?2 1319! ?006, 15.01.2006, 'i t

17.01.2008. l--lowever, the last purc',ha " -1 .. Hesrn byi M/s. IWuftesh lpdustries ftorr was underiinvoice dated 30.1 2.20G5. M/s. Che,mplast, there is no other mi 172 SG Resril, it appeared that il,e Resin, with' M/s. tVul<esh Irtdustrie:| w Ft1(hef i,nqltiry revealecl that the a'pol 172 SG Resm of batch hlo. 408,4(,ilg,, ntanufactured at Salent, Tantil I; hl transferrqd to Delhi had been nurct,,i:tst I 'l: I 42,44,45 & 46/20L1 L l.' I il t. i: 'l , ,1', !.' t, -""-'- *"-: ; -- rru J l{- 'i .; :'i' ,l !r't,\ CEAC 41, il rll :lll ;.,:ll ,,ll which cle'arly s;howed that the stock,of lpp 'lT'2 S:g Rerslt found in lthe premises of \l/l/s. Il/luti:e$h Industries had come frorn M/:;. Natraj." . ll :,,11

¶13We may irote fhat tlre 'l'indirrg of tfre.ifrlibunal is i:krat i:hc., eni:ir<r r',ll ' quantity of 7$B;03 MT of resin CP17zSG',wdiu procurc-:cl arrcl sotd to -rrt h,-:^^l^ nn:rJ.-l -,- n----:t nn:rr I r,. : - li . either Rajesh Mittal or Sunil .Mlittal. l(eer-rinb in vic;w the .farcls ancl lll .' circumstances ias're,corded/ fclund ancj ilr,l df uanturn of penarlty/,fin<: r:ll of Rs. 5 lacs ea,ch wlrich has been impt,s{0, \^/e clo not finrJ any ;ill reason or gro,und of enterlain the pre:'terllt appreal on ihe saiij u,'u"[ I '^\ ' il f\ 'li tl

¶14The last i contention raised by the lel!rrred c;ourrser[ 1'r:rr t:hr: ill .appellant is re$arding fine of Rs. 15 lacs; wfflictr has bet::rr intposr:iJ on Mr. DineshiCupta. lt is subrnittecl thrt'flne saicl i'irre lrari l:er-.rr I I imposed on Mr. Dinesh Gupta ad lre wasla Direc;trrr of T;,nnishrtr I Wires & Conductors Pvt. Ltrl. \/Ve do nof l,lO any meril: iri tlre :sair] .tt contention. \ff! inay notice tl'rat the triUr.lnai gav6 br='nefit ,r1'rj6ukrt ,.:1" to Mr, Gaurail Gupta, son of lVlr. Dirrirsll Gupi:a and tlre i'irre :.1 . imposecl on M,r. Dinesh Gr-lpta under Rr.rte lzo nru Lreen rercJucerj : from Rs. 50 lacs, to Rs. '15 lacs. Mr llin$shJ Cuptar wa$ a Drirerc;t:or ,.A both in Natraj pruut Indus;rr-ier ,t0 ,i", l';"';;;';;., \/\/ire:.; ,3,

1.r i i i I Conductors rvt. Lto ;i I ;' ...::;l ;;'l

¶15ln view Qf the aforesaicl cliscussionii*$ clo not iincl arr\i rnr,irit ';,1 ;,tttirl \tll CEAC 41, 42, 44, 45 & 46/Zo1,t i l t,age t-ir ot t !; rt ttl iiil irll.il i.il .l'il ll ll :[il 'iil

¶1tl il :'ll:il :. !l ljil .tii 'Irtlrll,ll, .:lli tl - .1,. .. I W in tlre present a;rpearl. appeals iare dismissed. Nlo substantial No costs. ApnlI Bisht 2fi12 09, CEAC 41, 42,44, 45 & 46/2011, i f-- *------ rl tu V on of law arise:;. 'ilre ( - "lt (-- ll\/ ll(li"lll\lN|l Nllr, . ll " l.r.\.,,.,-.,. lr,/\ $i\l\//i\ llR, Jl,, lril6c L5 ol':15

$-7 * IN THE HIGH COURT OF DELHI AT NEW DELHI % Date of Decision : 9th APril, 2012. + CEAC 4412011 SUNIL MITTAL ..." Petitioner Through Ms.Seema Jain with Mr.Ajay K.Jain & Ms.Savita Singh, Advs. VETSUS COMMISSIONER OF CENTRAL EXCISE ..... Respondent Through Mr.Kamal Nijhawan , Sr.Standing Counsel with Mr.Sumit Gaur, Adv. CORAM: HON'BLE MR. JUSTICE SANJIV KHANNA HON'BLE MR. JUSTICE R.V.EASWAR SANJIV KHANNA.J: (ORAL) For detailed orders. see CEAC No.4212011. April 09,2012 Bisht