Raj Kumar Gupta vs The Commissioner Central Excise & ...
2013 Latest Caselaw 6407 ALL

HIGH COURT OF JUDICATURE AT ALLAHABAD
 
 

AFR
 

 
Court No.32
 

 
Judgment reserved on 23.07.2013
 
Judgment delivered on 10.10.2013
 

 
Central Excise Appeal No.152 of 2013
 
Raj Kumar Gupta v. The Commissioner Central Excise & Service Tax
 

 
Central Excise Appeal No.153 of 2013
 
Vidyut Gupta v. The Commissioner Central Excise & Service Tax
 

 
Central Excise Appeal No.154 of 2013
 
Smt. Megha Gupta v. The Commissioner Central Excise & Service Tax
 

 
Central Excise Appeal No.155 of 2013
 
Smt. Bushra Gupta v. The Commissioner Central Excise & Service Tax
 

 
Central Excise Appeal No.156 of 2013
 
Shankar Pal v. The Commissioner Central Excise & Service Tax
 

 
Central Excise Appeal No.157 of 2013
 
Raghuwar Dayal v. The Commissioner Central Excise & Service Tax
 

 
Central Excise Appeal No.158 of 2013
 
A.K. Saxena v. The Commissioner Central Excise & Service Tax
 

 
Central Excise Appeal No.159 of 2013
 
Rahul Chauhan v. The Commissioner Central Excise & Service Tax
 

 

 
Hon. Sunil Ambwani, J.

Hon. Surya Prakash Kesarwani, J.

1. We have heard Shri B.P. Singh Thakray assisted by Shri Sushil Kumar Srivastava for the appellant. Shri Vinod Kant appears for the Central Excise Department.

2. These eight appeals are directed against a common order passed by the Customs, Excise and Service Tax Appellate Tribunal, Principal Bench, West Block No.2, R.K. Puram, New Delhi dated 10.1.2013 directing pre-deposit of Rs.1 Crore within eight weeks as a condition of stay of recovery of the balance amount of duty and penalties against all the applicants till the disposal of the appeals.

3. Brief facts giving rise to these appeals are that the officers of Directorate of Central Excise Intelligence received information that M/s Musk Tobacco (India) Ltd. is indulging in evasion of central excise duty by not accounting for their products and selling the goods without issue of invoices. Various locations of the company including its godowns and transporter's premises were searched. The officers found cigarettes of various brands namely ''777', ''Commander', ''Captain', recovered from the factory premises. Apart from these brands, cigarettes of ''Perfect' brand owned by M/s R.K. Cigarettes (P) Ltd. were also recovered. Huge quantity of shells, sliders, wrappers were also found, which showed that the company was also manufacturing goods for brands owned by others. The search at the godown resulted in recovery of ''Captain' brand cigarettes. The persons present in godowns stated that the goods were received without any invoices from M/s Musk Tobacco and accordingly the goods were seized.

4. The officers also carried out search at the Baba Roadlines and recovered 4000 packets of ''Perfect' brand belonging to M/s R.K. Cigarettes, which were seized. Certain diaries and note books were recovered from one Shri Inderjeet Yadav, an employee of M/s R.K. Cigarettes. Some of the documents revealed that the unaccounted raw materials were being received by M/s R.K. Cigarettes, Varanasi and that there are common Directors in M/s R.K. Cigarettes and M/s Musk Tobacco. The statement of various persons were recorded during investigation under Section 14 of the Act and show cause notice dated 18.5.2010 was issued to the appellants demanding central excise duty of Rs.7,74,09,518/- under Section 11A along with interest. The show cause notice also proposed to impose penalty under Section 11AC of the Central Excise Act.

5. The applicants objected to the show cause notice dated 18.5.2010. The case was adjudicated by the Commissioner, Central Excise and Service Tax, Lucknow confirming duty of Rs.7,74,09,518/- and equal amount of penalty on M/s Musk Tobacco, and various kinds of penalties on other applicants as follows:-

"(a) I confirm the demand of duty amounting to Rs. 7,74,09,518/-(Rupees Seven Crores Seventy Four Lakhs, Nine Thousand five Hundred and Eighteen only) on M/s Musk Tobacco India Pvt. Ltd., Manpur Nagaria, P.O. Neoli, Distt. Kashi Ramnagar under the provision of Section 11A of Central Excise Act, 1944. I order the recovery of interest under Sec. 11 AB (erstwhile) of Central Excise Act, 1944 at an appropriate rate.

(b) I impose a penalty of Rs. 7,74,09,518/- (Rupees Seven Crores Seventy Four Lakhs, Nine Thousand five Hundred and Eighteen only) on M/s Musk Tobacco India Pvt. Ltd., Manpur Nagaria, P.O. Neoli, Distt. Kashi Ramnagar under Rule 25 of Central Excise Rules, 2002 read with Section 11AC of the Central Excise Act 1944.

1.I impose a penalty of Rs. 10,00,000/- (Rupees Ten Lakhs Only) on Shri A.K.Saxena, Director, M/s Musk Tobacco India Pvt. Ltd., Manpur Nagaria, P.O. Neoli, Distt. Kashi Ramnagar under Rule 26 of Central Excise Rules, 2002.

2.I impose a penalty of Rs. 10,00,000/- (Rupees Ten Lakhs Only) on Shri Rahul Chauhan, Director, M/s Musk Tobacco India Pvt. Ltd., Manpur Nagaria, P.O. Neoli, Distt. Kashi Ramnagar under Rule 26 of Central Excise Rules, 2002.

3.I impose a penalty of Rs. 1,00,00,000/- (Rupees crore Only) on Smt. Bushra Gupta, w/o Shri R.K.Gupta, Director, M/s Musk Tobacco India Pvt. Ltd., Manpur Nagaria, P.O. Neoli, Distt. Kashi Ramnagar under Rule 26 of Central Excise Rules, 2002.

4.I impose a penalty of Rs. 1,00,00,000/- (Rupees crore Only) on Shri Raj Kumar Gupta, H-5 Maharani Bagh, New Delhi, under Rule 26 of Central Excise Rules, 2002.

5.I impose a penalty of Rs. 1,00,00,000/- (Rupees crore Only) on Shri Vidyut Gupta, H-5 Maharani Bagh, New Delhi, under Rule 26 of Central Excise Rules, 2002.

6.I impose a penalty of Rs. 1,00,00,000/- (Rupees crore Only) on Megha Gupta w/o Shri Upkaran Gupta, Director, M/s Musk Tobacco India Pvt. Ltd., Manpur Nagaria, P.O. Neoli, Distt. Kashi Ramnagar under Rule 26 of Central Excise Rules, 2002.

7.I impose a penalty of Rs. 10,00,000/- (Rupees Ten Lakhs Only) on Shri Raghu @ Raghuvar Dayal S/o Shri Ram Lal Village Nangla Patia P.O. Neoli, Distt. Kashi Ramnagar under Rule 26 of Central Excise Rules, 2002.

8.I impose a penalty of Rs. 10,00,000/- (Rupees Ten Lakhs Only) on Shri Shankar Pal @ Shankar Pal Pradhan S/o Shri Jamuna Prasad, Village Nangla Patia P.O. Neoli, Distt. Kashi Ramnagar under Rule 26 of Central Excise Rules, 2002.

 
						      (VANADANA K JAIN)
 

 
COMMISSIONER
 
					   CENTRAL EXCISE & 					         SERVICE TAX						           LUCKNOW"
 

 

6. It is pertinent to state here that the Commissioner, Central Excise and Service Tax, Lucknow in his order dated 28.9.2011 confirmed the invocation of extended period of limitation in the show cause notice on the ground that M/s Musk Tobacco was involved in manufacture of cigarettes clandestinely from the unaccounted for raw materials received by them and clearing it clandestinely without payment of duty through different directors and employees of the company and also involvement of Smt. Bushra Gupta; Smt. Megha Gupta; Shri Shankar Pal Pradhan and Shri Raghuvar Dayal apart from the main role played by Raj Kumar Gupta, who was master mind in setting up of Musk Tobacco and is the main person acting behind the entire operations of Musk Tobacco. He misled the officers, gave wrong statement, deliberately gave confused reports of the functionaries like Raghu, Shankar Pal, A.K. Saxena and Rahul Chauhan. The involvement of Shri Vidyut Raj Gupta with his father Shri Raj Kumar Gupta for playing an active role in the setting up of unit was also confirmed in evading payment of central excise duty and for which all these persons were held liable for penalty. The modus operandi of the group of persons in evasion of excise duty is summarized in the findings of the Commissioner, Central Excise as follows:-

"I find that Capt. R K Gupta and his son Vidyut Raj Gupta were the master mind behind the functioning of M/s Musk Tobacco, whose roles have been discussed at length in preceding paras. Sri Raj Kumar Gupta once started a Cigarette Manufacturing Unit M/s R.K. Cigarettes at Varanasi and remained Director of that company. M/s Cayman Tobacco was established at Varanasi for manufacture of cigarette in the year 2002 but could not take off and got shifted to Manpur Nagaria. Sri Vidyut Gupta or Capt. Raj Kumar Gupta was one of the Directors of the company and the main person behind it.

Although it acquired land, building and started procuring machines, it could not take off and decided to transfer all infrastructures to M/s Musk Tobacco already formed by that time. Although Shri Raj Kumar Gupta and they continued to be the main persons behind the functioning of M/s Musk Tobacco, which is clear from the following facts :-

(i)M/s Musk Tobacco is a registered company and and majority of the shares are held by Capt. Raj Gupta and family. Besides Smt. Busra Gupta w/o Sri Raj Kumar Gupta. Smt. Megha Gupta wife of Shri Upakaran Gupta (son of Shri Raj Kumar Gupta) were the directors in the firm which means the company was being controlled by the family members of Shri Raj Kumar Gupta. Since they hold the majority of the shares, the profit accrued from the company would go to the family only.

(ii) Shri Raj Kumar Gupta adopted an elaborate system for procurement of shells, sliders through middlemen viz. Shri Inderjeet Yadav of Kolkata and M/s J. K. Printers for M/s Musk Tobacco what he had already done for M/s R.K.Cigarettes, Varanasi earlier. Same system of procurement and payment through Shri Inderjeet Yadav to Shri Sipani of M/s J.K.Printers remained continued for M/s Musk Tobacco also because of experience of these persons and the shells and Sliders were being dispatched to Bareilly and then to Soron the nearest Railway Station to M/s Musk Tobacco. All other raw materials were procured by following the same pattern. Since the goods were procured clandestinely the payments were made by cash. Shri Sipani and Shri Inderjeet Yadav in their statements, also confirmed the same. The goods landed at M/s Musk Tobacco, as established already, clearly indicate that it was Capt. R.K.Gupta who was making all payments and the suppliers recognized M/s Musk Tobacco through Capt. Raj Kumar Gupta only because of previous association.

(iii) All the payments were made from the personal accounts of either Shri Raj Kumar Gupta or his son Shri Vidyut Gupta for procurement of machineries. Even the cheques were signed by Capt Raj Kumar Gupta as Director of the company, although officially he was not the director. This indicates that he was actively involved in the functioning and financial dealings of M/s Musk Tobacco which is not possible unless he had interest and stake in the company.

(iv) I found that Shri R.K.Gupa was managing all payments for purchase of raw material and machinery. As it emerged during scrutiny that cheque No. 232901 of SBI, Neoli issued from account No. 1000025305 for Rs. 1.20 Lakhs to M/s jackson Ltd. for supply of D.G. Set to M/s Musk Tobacco, was signed by Shri R.K.Gupta. Also DD No. 25363 of Rs. 30.00 Lakhs was issued by SBI, New Friends Colony, New Delhi in favour of M/s Dynmic Tools for supply of a unit of cigarette maker and the payment was made from account no. 30080714177 of Shri R.K.Gupta. Similarly, payment to M/s Budhan Engg. Pvt. Ltd., for supply of wrapping machine was made vide DD No. 25362 of Rs. 10.00 Lakhs from account No. 1760010002593 of Shri R.K.Gupta.

Further, Shri Indrajeet Yadav in his statement dated 26.9.2007 has stated that he used to receive money from Director/Shri R.K.Gupta for payment to parties directly. Also Shri Sipani of m/s J.K.Printers admitted in his statement dated 20.11.2008 that he received payment in cash from Shri R.K.Gupta through Shri Indrajeet Yadav.

Thus it is beyond doubt that Shri Raj Kumar Gupta, several time contacted suppliers and exercised his influence to provide machinery etc. to M/s Musk Tobacco which has been confirmed by the suppliers.

(v)Similarly Shri Vidyut Raj Gupta admitted having provided the machines to M/s Musk Tobacco and continued to involve himself in the affairs of Musk Tobacco throughout. It is also established that the day to day requirement of the company in terms of infrastructure requirement, its maintenance etc. were being done supervised, financed by Shri Vidyut Gupta. Even the requirement of printing of shells and sliders etc. by M/s Grant Print at Gurgaon was managed by Shri Vidyut Gupta. This clearly indicated his active participation in the affairs of the company. Shri Rahul Chauhan in his statement dated 03.07.09 and Shri A.K.Saxena in his statement dated 27.12.07 and 31.12.07 have admitted that the maintenance, repair etc. were supervised by none other than Shri Vidyut Gupta. They had, strangely, no knowledge about procurement of tobacco, the main raw materials, which was also looked after by Shri Vidyut Gupta.

(vi) Further procuring of raw material and sales of clandestinely cleared cigarettes were being controlled by Shri R.K.Gupta directly. The suppliers of shell and sliders, Shri Jitendra Kumar, Sipani @ Munnaji and Inderjeet Yadav have categorically named Capt. R.K.Gupta as the person placing orders, finalizing rates and making payments.

(vii)Shri Raj Kumar Gupta kept the records relating to M/s Musk Tobacco and M/s Cayman Tobacco in other places like the residence of Shankar Pal and Shri Raghu, as they were their trusted persons. Neither Shri Vidyut Gupta nor Shri Raj Gupta came forward to explain the details found in the documents recovered from the residence of Shankar Pal. It was well disguised affair to keep all the documents of their secret transactions in the residence of their trusted persons to avoid detection.

(viii) The involvement of Capt. R.K.Gupta in M/s Musk Tobacco is clearly visible from the dispatch statement recovered from Shankar Pal's residence. This document was nothing but dispatch statement of spare parts dispatched by Shri Inderjeet Yadav. These spare pats were supplied to M/s Musk Tobacco and Capt. Gupta has kept it safely in Shankar Pal's residence.

(ix)Some of the employees of Gupta agricultural farm were looking after the activities of M/s Musk Tobacco. As stated by Shri Rahul Chauhan in his statement, M/s Musk Tobacco was located inside the agricultural farm and, therefore, it was looked after by some of the persons who were apparently shown to have been working with Gupta Agricultural Farm. Names of Shri Raghuvar Dayal, Shri Shankar Pal, Shri Ajay Saxena, Shri Rahul Chauhan were appearing in the ledger of the farm. All these persons were paid employees they were also attending to the work as shown from one Attendance Register. Although Shri Rahul Chauhan & Shri A.K.Saxena referred that they were not the same persons, it however was not correct, as they themselves identified many persons like Shri Raghuvar Dayal, Shankar Pal in the register being the persons of Gupta Agricultural Farm. Thus it is evident that the persons, though shown to have been inducted to work in the farm were actually working in M/s Musk Tobacco.

(x)Capt. Raj Kumar Gupta misled the officers, and tendered wrong statements, deliberately gave wrong information about the functionaries like Shri Raghu, shri Shankar Pal, Shri A.K.Saxena and Shri Rahul Chauhan.

In view of the above, it is proved beyond doubt that Capt.Raj Kumar Gupta and Shri Vidyut Raj were actively involved in the functioning of M/s Musk Tobacco. They indulged in clandestine production and clearance and abetted M/s Musk Tobacco in evasion of the Central Excise duty on the cigarettes. I hold that Capt. Raj Kumar Gupta and Shri Vidyut Raj were in full knowledge of the fact that the Cigarettes removed by Musk Tobacco clandestinely were liable to confiscation under Central Excise Law. Thus Capt. Raj Kumar Gupta and Shri Vidyut Raj are liable to penal action, for their acts of omission and commission under Rule 26 of the Central Excise Rules, 2002.

Smt. Bushra Gupta w/o Capt. Raj Kumar Gupta & Smt. Megha Gupta w/o Shri Upkaran Gupta were two of the directors of the company at the time M/s Musk Tobacco (p) Ltd. was found involved in evasion of duty. The two directors are business women as per declaration in Memorandum & Article of Association and were required to ensure proper maintenance of books of accounts under Section 209 of Companies Act, 1956. It was incumbent upon them to ensure that Central Excise procedure in relation to production are followed and the goods manufactured are cleared on payment of duty. But as discussed above that M/s Musk Tobacco was involved in a massive evasion of duty while they were in the helm of affairs. I conclude that these two Directors failed to discharge their duties lawfully, which resulted in evasion of Central Excise duty. They were aware that the clandestinely removed Cigarettes were liable to confiscation. Therefore, they are liable to penal action under Rule 26 of the Central Excise Rules, 1994.

Shri Shankar Pal Pradhan and Shri Raghu @ Raghuvar Dayal were involved in the act of concealing and keeping of the important records relating to clandestinely production, clearance and procurement raw materials of M/s Musk Gupta Pvt. Ltd. The role of Shri Shankar Pal Pradhan has already been discussed in detail, who was an employee of the Gupta Agricultural Farm and simultaneously involved with manufacturing activities of the unit of M/s Musk Tobacco (P) Ltd. He had tried to distract investigation with his evasive replies. He suppressed crucial information which was in his knowledge & possession. This proves his connivance & abetment beyond beyond doubt in evasion of Central Excise duty by M/s Musk Tobacco Pvt. Ltd., which has made him liable to action under Rule 26 of the Central Excise Rules, 1994.

Similarly the role of Shri Raghu / Shri Raghuvar Dayal, as already discussed, who never appeared to explain the contents of the documents recovered from his residence inspite of repeated summons. He deliberately avoided his presence from the officers as several important documents relating to Capt. R.K.Gupta and M/s Musk Tobacco were found in his residence.

I hold that Shri Shankar Pal Pradhan and Shri Raghu Raghuvar Dayal were had full knowledge that the Cigarettes removed by Must Tobacco clandestinely were non-duty paid which were liable to confiscation under Central Excise law. Thus Shri Shankar Pal Pradhan and Shri Raghu Raghuvar Dayal are liable to penal action for their acts of omission and commission under Rule 26 of the Central Excise, 2002."

7. The appellants have filed separate Excise Appeal Nos.366 to 373 of 2012 and Excise Appeal No.508 of 2012 in which they filed stay application for waiver of pre-deposit of the amount. The CESTAT has by the order under challenge in all these appeals, considering the facts and circumstances and the financial position of the applicants directed the applicants to deposit Rs.1 crore as pre-deposit within eight weeks and to report compliance on 28.3.2013. On due compliance it was directed that recovery of balance amount of duty and penalties against the applicants shall remain stayed.

8. The CESTAT prima facie found that the Commissioner in the impugned order has examined various aspects and evidences in relation to manufacture such as seizure at the factory premise of M/s Musk Tobacco on 26.09.2007; plant and machinery, powers supply and other evidences of manufacture. He has also gone through the various documents recovered during the search of the various premises and also statements recorded and has come to conclusion that M/s Musk Tobacco was indulging in evasion of the duty by clandestinely removing cigarettes. Production and dispatch register showing production and dispatch from 16.1.2007 to 18.3.2007 was resumed from the residence of Raghu, an employee of Gupta Farm owned by Shri R.K. Gupta. Shri Rahul Chauhan, Director of M/s Musk Tobacco confirmed that it was not production and dispatch register of M/s Musk Tobacco but did not show the details in their records. The prima facie suppression of production and clandestine removal was thus established. The CESTAT also observed that the Commissioner has found that the applicants were dispatching finished goods to different destinations through road/ railway transport. During the search of Baba Roadlines on 26.9.2007, Perfect brand cigarettes were found without invoices. Shri Kamal Singh Yadav, person in charge of transport company stated that these goods were received by them from M/s Musk Tobacco. Prima facie it was found that the production was suppressed by M/s Musk Tobacco and goods were cleared clandestinely and that M/s Musk Tobacco was also manufacturing other brands of cigarettes.

9. Shri B.P. Singh Thakrey submits that the CESTAT has grossly erred on facts and in law in directing the appellants to deposit Rs.1 crore for staying balance amount of duty and penalty against all the applicants. The CESTAT has failed to consider that the appellants have very strong prima facie case to succeed on merits. Shri R.K. Gupta was never Director of M/s Musk Tobacco (India) Pvt. Ltd., Manpur (Nagaria), Kanshi Ram Nagar. The penalty of Rs.1 crore has been imposed with observations that the appellant was actively involved in the functioning of M/s Musk Tobacco (India) Pvt. Ltd., whereas no penalty can be imposed under Rule 26 of the Central Excise Rules, 2002 without putting the appellant to notice. The penalty is based upon presumption that order detriment to a person can be passed without issuing show cause notice. The Addl. Director General, Directorate General, Central Excise (Intelligence), New Delhi has erroneously issued notice to M/s Musk Tobacco (India) Pvt. Ltd., Manpur (Nagaria), Distt. Etah, when there was no proposal to impose penalty on the appellant. The imposition of penalty of Rs.1 crore upon the appellant by common judgment dated 10.1.2013 is grossly illegal and is liable to be set aside. Shri Thakrey further submits that imposition of penalty is quasi criminal proceedings and hence a common order contains a lot of ambiguities cannot be treated as reasoned or speaking order. The impugned order has not distinguished the specific liability and has failed to appreciate the independent merits of the appellant while disposing the common stay application under Section 35F of the Act. He submits that the appellant has been deprived of his right to get the full waiver of pre-deposit on establishing good merits of the case. Shri Thakrey has relied on judgment of the Supreme Court in Gokak Patel Volkart Ltd. v. CCE, 1987 (28) ELT 53 (SC); Union of India v. Madhumilan, 1988 (35) ELT 349 (SC); Collector of CE Baroda v. Kosan metal Products Ltd., (1988) (38) ELT 573 (SC); Union of India v. Tata Udyodogawa Ltd., 1988 (38) ELT 739 (SC); Kaur and Singh v. C.C.E., 1997 (94) ELT 289 (SC); CCE v. Rajasthan Textiles Mills, 1997 (94) ELT 481 (SC); Metal Forgings Ltd. v. Union of India, 2002 (146) ELT 241 (SC) and CCE v. Gamoon Farchemicals Ltd., 2003 (152) ELT 28 (SC) in support of his submissions that the show cause notice is mandatory requirement before raising any demand. The communication, order, suggestion or advice from the department are not show cause notices. A specific show cause notice indicating the amount demanded and calling upon the assessee to show cause notice, if he has any objection is necessary. The notice also indicates that there is demand or non-payment of duty, and must also indicate that the grounds for invoking extended period of limitation are present.

10. We have gone through the show cause notice and the order passed by the Commissioner, Central Excise and do not find any error of law in issuing of the notice or any prima facie error in the findings recorded by the Commissioner with regard to clandestine removal of the excisable goods. The modus operandi adopted by Shri R.K. Gupta with the help of other appellants prima facie demonstrates that there was premeditated exercise to remove the excisable goods without payment of duty and that extended period of limitation was invoked in show cause notice to which the appellants gave their reply.

11. In Benara Valves Ltd. & Or. v. Commissioner of Central Excise & Anr., (2006) 13 SCC 347 the Supreme Court explained the limitations on the exercise of discretionary jurisdiction under Section 35F of the Central Excise Act, 1944. In paragraphs 11 to 15 the Supreme Court has laid down the scope and ambit of the expressions 'undue hardship to such person' and 'safeguard the interests of the Revenue'. Paragraphs 11 to 15 of the judgment are quoted as below:-

"11. Two significant expressions used in the provisions are "undue hardship to such person" and "safeguard the interests of revenue". Therefore, while dealing with the application twin requirements of considerations i.e. consideration of undue hardship aspect and imposition of conditions to safeguard the interest of Revenue have to be kept in view.

12. As noted above there are two important expressions in Section 35(F). One is undue hardship. This is a matter within the special knowledge of the applicant for waiver and has to be established by him. A mere assertion about undue hardship would not be sufficient. It was noted by this Court in S. Vasudeva v. State of Karnataka and Ors. (AIR 1994 SC 923) that under Indian conditions expression "Undue hardship" is normally related to economic hardship. "Undue" which means something which is not merited by the conduct of the claimant, or is very much disproportionate to it. Undue hardship is caused when the hardship is not warranted by the circumstances.

13. For a hardship to be 'undue' it must be shown that the particular burden to have to observe or perform the requirement is out of proportion to the nature of the requirement itself, and the benefit which the applicant would derive from compliance with it.

14. The word "undue" adds something more than just hardship. It means an excessive hardship or a hardship greater than the circumstances warrant.

15. The other aspect relates to imposition of condition to safeguard the interest of revenue. This is an aspect which the Tribunal has to bring into focus. It is for the Tribunal to impose such conditions as are deemed proper to safeguard the interest of revenue. Therefore, the Tribunal while dealing with the application has to consider materials to be placed by the assessee relating to undue hardship and also to stipulate condition as required to safeguard the interest of revenue."

12. In the present case we do not find that the Tribunal has committed any error of law in directing the appellants to deposit Rs.1 crore for stay of remaining amount of excise duty and penalties. The Tribunal has directed the appellants to deposit a lumpsum amount of Rs.1 crore giving benefit of Rs.6,74,09,518/- for excise duty and Rs.7,74,09,518/- as penalty as also various amounts of penalties imposed on the appellants. Since it was found that all the appellants had acted with common design and purpose to evade excise duty by clandestinely removing excisable goods, the demand on lumpsum basis does not suffer from any arbitrariness. The Tribunal has given substantial relief based on the financial position of the appellants.

13. We do not find any good ground to interfere with the common order passed by the Tribunal.

14. All the central excise appeals are dismissed. If the appellants have not deposited the amount of Rs.1 crore so far and the appeal has not been dismissed for failing to deposit the amount, the appellants will get four weeks' further time from today to deposit the amount.

Dt.10.10.2013

SP/