Evasion of central excise duty by the appellant

Last updated: 01 May 2021

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M/s Sky Alloys & Power Pvt. Ltd., manufacturers of Sponge Iron, MS Ingots, and Silico Manganese, were investigated for alleged evasion of central excise duty. A search of their premises revealed excess, unaccounted stock of MS Ingots and Iron Ore. Consequently, a show cause notice was issued, leading to the confiscation of the seized goods and penalties, which were upheld on appeal.

Court :
CESTAT New Delhi

Brief :
The appellant M/s Sky Alloys & Power Pvt. Ltd. are engaged in manufacture of Sponge Iron, MS Ingots and Silico Manganese. Their premises were got searched on 7 November 2015 and 8 November 2015 by the team of Preventive Officers of Central Excise, Customs and Service Tax acting upon the intelligence gathered about evasion of central excise duty by the appellant by way of procurement of unaccounted raw materials, clandestine manufacture of excisable goods without accounting the same in their daily stock account and removing the same without payment of central excise duty.

Citation :
EXCISE APPEAL NO. 52765 of 2019 (SM)

CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
NEW DELHI

PRINCIPAL BENCH, COURT NO. IV

EXCISE APPEAL NO. 52765 of 2019 (SM)

[Arising out of the Order-in-Appeal No. BHO-EXCUS-002-APP-40-19-20 dated
24/06/2019 passed by The Commissioner (Appeals), Central Excise, Customs
& Service Tax, Raipur.]

M/s Sky Alloys & Power Pvt. Ltd. Appellant
Khasra No. 166, Village Temtema, Kharsia,
Raigarh (C.G.)

VERSUS

Assistant Commissioner, Respondent
Customs & Central Goods & Service Tax,
Division Raigarh (C.G.).

Appearance

Shri Vinay K. Jain, Advocate – for the appellant.

Shri Yashveer Singh, Authorized Representative (DR) – for the
Respondent.

CORAM: HON’BLE MRS. RACHNA GUPTA, MEMBER (JUDICIAL)

FINAL ORDER NO. 51253/2021
DATE OF HEARING : 05/04/2021.
DATE OF DECISION: 12/04/2021.

RACHNA GUPTA :-

The appellant M/s Sky Alloys & Power Pvt. Ltd. are engaged in manufacture of Sponge Iron, MS Ingots and Silico Manganese. Their premises were got searched on 7 November 2015 and 8 November 2015 by the team of Preventive Officers of Central Excise, Customs and Service Tax acting upon the intelligence gathered about evasion of central excise duty by the appellant by way of procurement of unaccounted raw materials, clandestine manufacture of excisable goods without accounting the same in their daily stock account and removing the same without payment of central excise duty. The documents were recovered during the search and the investigating team also got stock of finished goods and raw material during the physical verification. While comparing the said physical verification report and the documents recovered with the opening stock finished goods and the raw material declared by the noticee the team noticed that 56.300 MT of MS Ingots and 221.693 MT of Iron Ore is excess/unaccounted stock in the factory premisesResultantly a show cause notice No. 3976 dated 3 May 2016 was served upon the appellants proposing the seized MS Ingots and the Iron Ore to be confiscated alongwith the proposal of imposition of penalty. The said proposal was initially confirmed vide order-in-original No. 20/ADJ/AC/RGH/C.Ex/2018-19 dated 15 January 2019. The appeal thereof has been dismissed vide order-in-appeal No. BHOEXCUS-002-APP-40-19-20 dated 24 June 2019. Being aggrieved the appellant is before this Tribunal.

2. I have heard Shri Vinay K. Jain, learned Counsel for the appellant and Shri Yashveer Singh, learned Authorized Representative for the Department.

To know more in details find the attachment file

FAQ :

The company was accused of evading central excise duty by procuring unaccounted raw materials, clandestinely manufacturing excisable goods without proper accounting, and removing them without paying the required duty.

During the search, the investigating team found excess/unaccounted stock of 56.300 MT of MS Ingots and 221.693 MT of Iron Ore in the factory premises when compared to the declared stock.

An order-in-original confirmed the proposal for confiscation of the seized MS Ingots and Iron Ore, along with the imposition of penalties.

The Commissioner (Appeals) dismissed the appeal filed by M/s Sky Alloys & Power Pvt. Ltd., upholding the order-in-original.

The appellant, M/s Sky Alloys & Power Pvt. Ltd., has filed an appeal before the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) challenging the decision of the Commissioner (Appeals).