BILESH JAIN vs PRINCIPAL COMMISSIONER OF CGST-DELHI EAST

CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
NEW DELHI.

PRINCIPAL BENCH,
COURT NO. I

EXCISE APPEAL NO. 52178 OF 2019

[Arising out of the Order-in-Appeal No. 25-30/CE/DLH/2019 dated
29/05/2019 passed by The Commissioner (Appeals-I), Central Tax & CGST,
Delhi, New Delhi – 110 002.]

Shri Bilesh Jain, Proprietor, ……Appellant
M/s Delhi Marketing,
F-87-88, Jagat Puri,
Delhi – 110 051.
Versus

Commissioner of ….Respondent
Central Excise & CGST, Delhi East,
C.R. Building, I.P. Estate,
New Delhi – 110 002.

WITH
EXCISE APPEAL NO. 52179 OF 2019

[Arising out of the Order-in-Appeal No. 25-30/CE/DLH/2019 dated
29/05/2019 passed by The Commissioner (Appeals-I), Central Tax & CGST,
Delhi, New Delhi – 110 002.]

M/s Kundan Cab Pvt. Ltd., ……Appellant
554A/17K (C. No. 2113)
Bhim Gali, Vishwas Nagar,
New Delhi – 110 032.
Versus

Commissioner of ….Respondent
Central Excise & CGST, Delhi East,
C.R. Building, I.P. Estate,
New Delhi – 110 002.

WITH
EXCISE APPEAL NO. 52180 OF 2019

[Arising out of the Order-in-Appeal No. 25-30/CE/DLH/2019 dated
29/05/2019 passed by The Commissioner (Appeals-I), Central Tax & CGST,
Delhi, New Delhi – 110 002.]

Shri Dinesh Jain, Director, ……Appellant
M/s Balar Marketing Pvt. Ltd.,
217, Patparganj Industrial Area,
New Delhi – 110 092.

Versus

Commissioner of ….Respondent
Central Excise & CGST, Delhi East,
C.R. Building, I.P. Estate,
New Delhi – 110 002.

2 EX/52178-52183 OF 2019



WITH
EXCISE APPEAL NO. 52181 OF 2019

[Arising out of the Order-in-Appeal No. 25-30/CE/DLH/2019 dated
29/05/2019 passed by The Commissioner (Appeals-I), Central Tax & CGST,
Delhi, New Delhi – 110 002.]

M/s Balar Marketing Pvt. Ltd., ……Appellant
217, Patparganj Industrial Area,
New Delhi – 110 092.

Versus

Commissioner of ….Respondent
Central Excise & CGST, Delhi East,
C.R. Building, I.P. Estate,
New Delhi – 110 002.

WITH
EXCISE APPEAL NO. 52182 OF 2019

[Arising out of the Order-in-Appeal No. 25-30/CE/DLH/2019 dated
29/05/2019 passed by The Commissioner (Appeals-I), Central Tax & CGST,
Delhi, New Delhi – 110 002.]

Shri Paras Mal Jain, Director, ……Appellant
M/s Balar Marketing Pvt. Ltd.,
217, Patparganj Industrial Area,
New Delhi – 110 092.

Versus

Commissioner of ….Respondent
Central Excise & CGST, Delhi East,
C.R. Building, I.P. Estate,
New Delhi – 110 002.

AND
EXCISE APPEAL NO. 52183 OF 2019

[Arising out of the Order-in-Appeal No. 25-30/CE/DLH/2019 dated
29/05/2019 passed by The Commissioner (Appeals-I), Central Tax & CGST,
Delhi, New Delhi – 110 002.]

M/s Delhi Marketing, ……Appellant
F-87-88, Jagat Puri,
Delhi – 110 051.

Versus

Commissioner of ….Respondent
Central Excise & CGST, Delhi East,
C.R. Building, I.P. Estate,
New Delhi – 110 002.

3 EX/52178-52183 OF 2019



APPEARANCE:

Shri Rupesh Kumar, Shri Piyush Kumar, Shri Jitendra Singh,
Shri Sharad C. Srivastava and Ms. Gunjan Tanwar, Advocates
– for the appellant.
Shri Rajat Malhotra, Authorized Representative (DR) – for the
Department.


CORAM:
HON’BLE SHRI ASHOK JINDAL, OFFICIATING PRESIDENT
HON’BLE MR. P.V. SUBBA RAO, MEMBER (TECHNICAL)




FINAL ORDER NO’s. 51669-51674/2026


DATE OF HEARING : 08.09.2026
DATE OF DECISION: 05.11.2026

ASHOK JINDAL

All the appeals are arising out of common investigation
and common impugned orders, therefore, all are disposed of
by a common order.

2. The appellant M/s Delhi Marketing is a proprietorship
concern and engaged in trading of electrical items. Balar
Marketing Pvt. Ltd. is a private limited company and is
registered with Central Excise Department manufacturing
electrical items. M/s Kundan Cab Pvt. Ltd. is a Private Limited
company dealing in electrical items and not registered with
Central Excise department. The other appellants namely, Shri
Bilesh Jain is the Proprietor of Delhi Marketing, Shri Paras Mal
Jain is the Director of M/s Balar Marketing Pvt. Ltd. and M/s
Kundan Cab Pvt. Ltd. and Authorized Representative of Delhi

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Marketing and Shri Dinesh Jain is the Director of M/s Balar
Marketing Pvt. Ltd. and M/s Kundan Cab Pvt. Ltd.

3. The facts of the case are that on 11.02.2011 a search
was conducted at the appellant‟s premises as well as the
residence premises. At the premises of M/s Delhi Marketing
goods valued of Rs. 6,25,46,332/- was found in excess of the
recorded stock and Indian currency amounting to Rs.
10,25,000/- On the day of search, the panchnama was drawn
and the above said cash Indian currency and the electrical
goods were seized. The statement of Shri Suresh Jain,
Accountant was recorded who stated that the electrical goods
bearing brand name of Kundan, Kundan Gold Medal GM 5
gross and IPI. During the course of investigation, the appellant
(M/s Delhi Marketing) paid Rs.1,00,00,000/- on 14.03.2011,
M/s Delhi Marketing applied on a registration under Central
Excise Act as (it was insisted by the investigating officer) to
facilitate depositing all the above said cheque towards central
excise duty, therefore, on 17.03.2011 a physical verification
was conducted with regard to application of registration, as
there was no power connection, no plant and machinery and
other instruments for manufacturing activity, therefore, the
registration granted online on 14.03.2011 was revoked. On
24.03.2011, the department converted detention of goods
under panchnama dated 11.02.2011 into seizure and
thereafter then Commissioner, Central Excise, provisionally
released of seized goods on execution of bond without

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executing bank guarantee. Simultaneously, the search was
conducted at the residential premises and the co-appellants in
case of M/s Balar Marketing Pvt. Ltd. wherein goods valued
Rs.26,01,410/- found excess of recorded stocks and Indian
currency of Rs.39,500/- were found and currency of
Rs.33,10,000/- was found from the residence of Shri Paras Mal
Jain and Shri Dinesh Jain and the same were seized. On
12.02.2011 Shri Dinesh Jain filed a letter explaining the source
of currency seized. Further, search was conducted in the
premises of M/s Kundan Cab Pvt. Ltd. and seized the part of
the goods alleged that appellant was engaged in
packing/repacking labeling of the goods which amounts to
manufacture in terms of section 2f (iii) of the Central Excise
Act, 1944 and is not registered with the Central Excise
department.
4. Later on, a show cause notice were issued on
11.08.2011 to all the appellants alleging as under :-

“25. Now therefore, M/s Balar Marketing, 217, Patparganj,
Industrial Area Delhi, Shri Parasmal Jain, Director and Shri Dinesh
Jain Director of the firm are hereby called upon to show cause to
the Additional Commissioner, Central Excise, Delhi – II, C.R.
Building, New Delhi within 30 days of the receipt of this notice as
to why:

(i) That the excisable goods valued at Rs. 26,01,410/- of
M/s Balar Marketing Pvt. Ltd. should not be confiscated
under Rule 25 of the Central Excise Rules, 2002
(ii) That the Indian currency amounting to Rs. 3,09,500/-
and Rs.33,10,000/- resumed from factory premises and
the residence of the directors respectively should not be
confiscated under section 121 of the Customs Act 1962
as applicable in the like matter in the Central Excise
under Notification No. 68/63 (NT) dated 04.05.1963
(iii) That the penalty should not be imposed upon M/s Balar
Marketing, 217, Patparganj, Industrial Area Delhi under
rule 25 of Central Excise Rules, 2002

6 EX/52178-52183 OF 2019



(iv) Penalty should not be imposed separately upon Shri
Parasmal Jain and Shri Dinesh Jain, Director of M/s
Balar Marketing Pvt. Ltd. Delhi under rule 25 of Central
Excise Rules, 2002.
26. Now therefore, M/s Delhi Marketing, 17, Patparganj,
Industrial Area Delhi, is hereby called upon to show cause to the
Additional Commissioner, Central Excise, Delhi – II, C.R. Building,
New Delhi within 30 days of the receipt of this notice as to why:

(i) That the Indian currency amounting to Rs. 10,25,000/-
should not be confiscated under section 121 of the
Customs Act, 1962 as applicable in the like matter in
the Central Excise under Notification No. 68/63 (NT)
dated 04.05.1963.
(ii) The penalty should not be imposed on Shri Bilesh Jain,
Proprietor of the company under Rule 26 of the Rules.
…..

28. Now therefore, M/s Kundan Cab Pvt. Ltd. (CN 2113) 554A/
17K, Bhim Gali, Vishvas Nagar Delhi and Shri Dinesh Jain, Director
of the firm are hereby called upon to show cause to the Additional
Commissioner, Central Excise, Delhi – II, C.R. Building, New Delhi
within 30 days of the receipt of this notice as to why :

(i) The excisable goods seized at the premises of M/s
Kundan Cab Pvt. Ltd. Delhi valued at Rs. 8,46,425/-
should not be confiscated under Rule 25 of the Central
Excise Rules, 2002 ;
(ii) Penalty should not be imposed M/s Kundan Cab Pvt.
Ltd. Delhi under Rule 25 of Central Excise Rules, 2002
(iii) Penalty should not be imposed upon Shri Parasmal Jain,
Director M/s Kundan Cab Pvt. Ltd. Delhi under Rule 25
of Central Excise Rules, 2002”.

5. The appellants contested the show cause notice, but the
authorities below confirmed the demand as proposed in the
show cause notice and held goods and currency seized are
liable for confiscation and seized goods in case of Delhi
Marketing were allowed to be redeemed on payment of
redemption fine of Rs.1,85,00,000/-. In case of M/s Balar
Marketing Pvt. Ltd., the goods were allowed to be redeemed
on payment of redemption fine of Rs.7,80,000/- and in case of
M/s Kundan Cab Pvt. Ltd., the goods were allowed to be

7 EX/52178-52183 OF 2019



redeemed on payment of redemption fine of Rs.2,50,000/- and
penalty on all the appellants were imposed.
6. Further, another show cause notice dated 09.02.2016
was also issued to all the appellants alleging the following :-

“40. In view of the above narrated facts and evidences and the
consequential infringements of the law, the noticee i.e. M/s
Kundan Cab Pvt. Ltd., 554A/17K (C No. 2113), Bhim Gali, Vishwas
Nagar, Delhi are hereby called upon to show cause to the
Commissioner, Central Excise, Delhi – II, within 30 days of the
receipt of this notice, as to why –

(i) The Central Excise duty of Rs. 3,14,497/- (Three lakh
fourteen thousand four hundred and ninety seven only)
should not be demanded from the noticee on the
clearances of manufactured goods thereof during the FY
2010-11, by invoking the extended period provided
under section 11A (4) of the Central Excise Act, 1944
(proviso to erstwhile section 11A (1) of the Central
Excise Act, 1944);
(ii) Interest at the appropriate rate under section 11AA of
the Central Excise Act, 1944 as amended (erstwhile
section 11AB of the Central Excise Act, 1944) should
not be charged from them on the duty payable that was
not paid by them at the appropriate time on clearance
of excisable goods as discussed above;
(iii) Penalty should not be imposed upon M/s Kundan Cab
Pvt. Ltd. under section 11AC of the Central Excise Act,
1944 red with Rule 25 of the Central Excise Rules, 2002
for the various acts of omission and commission as
discussed above.
(iv) Penalty should not be imposed under Rule 26 of Central
Excise Rules, 2002, on Shri Paras Mal Jain Director in
M/s Kundan Cab Pvt. Ltd. as he knowingly involved in
the clearance of excisable goods without payment of
Central Excise duty and for the various acts of omission
and commission as discussed above.


M/s Delhi Marketing, (Prop. Sh. Bilesh Jain), F-87/88, Jagat
Puri, Delhi

41. Now, therefore, M/s Delhi Marketing, (Prop. Shri Bilesh
Jain), F-87/88, Jagat Puri, Delhi are hereby required to show
cause to the Commissioner, Central Excise Commissionerate, Delhi
– II, C.R. Building, I.P. Estate, New Delhi within 30 (Thirty) days
from the date of receipt of this notice, as to why:-

8 EX/52178-52183 OF 2019



(i) Central Excise duty amounting to Rs. 61,04,086/-
(including cess) on the excisable goods as per 20 & 29
supra and Annexure „1A‟, „2A‟, „2B‟, „3A‟, „3B‟, „4‟, 5A,
5B, 6, 7A & 7B to this SCN, manufactured and cleared
by them during the period 2010-2011 to 2011-2012
should not be demanded and recovered from them
under section 11A (4) of the Central Excise Act, 1944
(proviso to erstwhile section 11A (1) of the Central
Excise Act, 1944);
(ii) Interest at the appropriate rate under section 11AA of
the Central Excise Act, 1944 as amended (erstwhile
section 11AB of the Central Excise Act, 1944) should
not be charged from them on the duty payable that was
not paid by them at the appropriate time on clearance
of excisable goods as discussed above;
(iii) Penalty should not be imposed upon them under section
11AC of the Central Excise Act, 1944 read with Rule 25
of the Central Excise Rules, 2002 for the various acts of
omission and commission as discussed above;
(iv) Penalty should not be imposed under Rule 26 of Central
Excise Rules, 2002, Shri Paras Mal Jain (de-facto owner
of the firm) Father of Shri Bilesh Jain, Prop. M/s Delhi
Marketing as he was knowingly involved in the
clearance of excisable goods without payment of
Central Excise duty and for the various acts of omission
and commission as discussed above;
(v) The finished goods seized at the premises of M/s Delhi
Marketing valued at Rs. 6,30,88,176/- should not be
confiscated under Rule 25 of the Central Excise Rules,
2002; and
(vi) The amount of Rs. 1,00,00,000/- (One Crore) having
been deposited by them voluntarily through cheque No.
879045 dated 09.03.2011 and No. 879044 dated
14.03.2011 for 50 lacs each towards their duty liability,
should not be adjusted and appropriated against
Central Excise duty, interest and penalty as mentioned
in paras (i) to (iv) above”.



5. Both the show cause notices were adjudicated all
together and the following order has been passed :-

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10 EX/52178-52183 OF 2019

11 EX/52178-52183 OF 2019





7. The appellants challenged the said order before the
Commissioner (Appeals), who affirmed the order of the
Adjudicating Authority, therefore, appellants are before us.
8. The learned Senior Advocate, Shri Rupesh Kumar
appeared before us who submitted that the appellant – Delhi

12 EX/52178-52183 OF 2019



Marketing is not engaged in any manufacturing activity as they
are engaged in the sale and purchase of electrical goods either
branded or non-branded which is evident from the report
dated 17.03.2011 wherein no electricity connection was found
no manufacturing machine was found no manufacturing
activity was found in the premises of the Delhi Marketing. M/s
Delhi Marketing has not the manufactured goods. In the show
cause notice and in the adjudication order, it has been alleged
that appellant is getting manufacturing goods from the job
workers in their account, therefore, the appellant is liable to
pay duty on this manufactured goods. It is the prayer of the
ld.Counsel that if goods are manufactured through job worker,
the job worker is liable to pay duty, not the appellant. It is the
submission that as appellant M/s Delhi Marketing is not
engaged in the activity of manufacturing, therefore, M/s Delhi
Marketing is not liable to pay duty at all. He further submits
that as appellant is not liable to pay duty and not doing any
manufacturing activity as a trader therefore, the confiscation
of finished goods and cash alleging that the same is the sale
proceeds of the dutiable goods is not sustainable. The
allegation of goods cleared clandestinely is also not
sustainable. Consequently, no penalty is imposable on Delhi
Marketing and Shri Paras Mal Jain and Shri Bilesh Jain on this
account.
8. He, further, submitted that in terms of section 110 of the
Customs Act, 1962 if any seizure took place, the show cause

13 EX/52178-52183 OF 2019



notice is required to be issued for confiscation of the goods
within six months/extended period of one year. If the show
cause notice is not issued during that period, in that
circumstances, the seized goods are liable to be released as
held by the Hon‟ble Delhi High Court in the case of Jatin
1
Ahuja versus Union of India . The said order has been
2
affirmed by the Hon‟ble Apex Court . Admittedly, in this case,
the show-cause notice for confiscation of the seized goods was
not issued within time limit prescribed under Section 110 of
the Customs Act, 1962, accordingly, the seized goods are to be
released without any confiscation.

9. With regard to M/s Balar Marketing Pvt. Ltd. it is his
contention that the goods seized during the course of
investigation alleging that they were found excess of recorded
in statutory records. It is the contention of the appellant that
the said goods has not reached up to the level of finished
goods as these goods are to be tested and to be re-packed,
therefore, the goods were in work in progress and the said
goods after provisionally released were cleared on payment of
duty. Therefore, the said goods cannot be held liable for
confiscation. He further submitted that the cash seized during
the course of investigation of Rs. 3,09,500/- is a cash balance
in cash book to meet day-to-day expenses by the appellant.
Further cash seized Rs.33,10,000/- from the residence,

1. 2013 (287) E.L.T. 3 (Del.)
2. 2025 (36) CENTAX 301 (S.C.)

14 EX/52178-52183 OF 2019



pertains to Rs.4,10,000/- is the personal property wife of Shri
Paras Mal Jain and Rs.4,00,000/- is of personal property of
wife of Shri Bilesh Jain and Rs.25,00,000/- is the advance
received on the account of sale of property three days prior to
seizure, which is evident from the sale agreement and entry
made in their cash ledger. Therefore, the said cash cannot be
seized.

10. Therefore the seizure of goods and redemption fine
imposed on the appellant along with penalties is not
sustainable.

11. With regard to M/s Kundan Cab Pvt. Ltd., it is his
submission that only one invoice was found on which appellant
is putting MRP stickers on the goods and packing it to small
packing, although, the said activity amounts to manufacture
but all these goods are MRP based and the manufacturer of the
said goods as already paid the duty thereon taking the
abatement from the MRP (applicable abatement), the affixing
MRP by the appellant there is no change in the MRP. As the
said goods already suffered the duty, therefore, the appellant
is not liable to pay duty. In alternative, it is the contention of
the appellant that as whatever duty paid by the appellant is
entitled to take Cenvat credit and being a non-registered with
the central excise department, the appellant has not taken the
Cenvat credit, therefore, the said non-availment of Cenvat
credit should be treated as payment of duty being it is revenue

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neutral situation. Therefore, it is prayed that no penalty is
imposable on the appellant and demand of duty also not
sustainable
12. He further, submitted that the Revenue‟s case is based
on the various statements recorded during the course of
investigation and all the witnesses became hostile during the
course of cross-examination, therefore, the said statements
recorded during the course of investigation are not reliable,
hence the Revenue‟s case is demolished as no other
supporting documents submitted by Revenue.
13. On the other hand, learned Authorized Representative
opposed the contention of the learned counsel. He submitted
that the statement of Shri Paras Mal Jain admitting that they
are getting the goods manufactured from job workers in their
accounts, therefore, as job workers are working on behalf of
the appellants, in that circumstances, the appellant, Delhi
Marketing, is liable to pay duty on the goods found during the
course of search. With regard to issuance of the show cause
notice on 09.02.2016 it is his submission that under section
124 of the Customs Act, there is no time limit to issue show
cause notice for confiscation of the goods as held by the Apex
Court in the case of Union of India versus Jatin Ahuja
(supra).
14. In the case of M/s Balar Marketing Pvt. Ltd. it is his
submission that it is a fact that during the course of
investigation, excess goods were found unaccounted therefore,

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the goods were rightly confiscated and allowed to be redeemed
on payment of redemption fine.
15. With regard to M/s Kundan Cab Pvt. Ltd. it is his
submission that admittedly the appellant was engaged in the
activity of packing/re-packing and affixing MRP stickers the
said activity amounts to manufacture in terms of Section 2f
(iii) of the Central Excise Act and the appellant is not
registered with the Central Excise department therefore, the
duty was rightly demanded from them and the goods were
held liable for confiscation. He further, submitted that in the
facts and circumstances of the case, the penalties on the
appellant are rightly imposed.

16. Heard the parties considered the submissions.

17. After hearing the parties and going through the records
before us, we find that the issues are to be decided by us
(a) whether M/s Delhi Marketing is a manufacturing
concern or not, if not, whether they are liable to pay duty and
the goods seized is liable for confiscation or not ?
(b) whether duty can be demanded from M/s Balar
Marketing Pvt. Ltd. on unfinished goods which were in the
process of testing and packing and putting MRP stockers which
were not entered in their RG-1 register, the said goods can be
confiscated and penalty be imposed. Further, the cash
recovered from the premises of M/s Balar Marketing Pvt. Ltd.

17 EX/52178-52183 OF 2019





and residential premises of Shri Bilesh Jain and Dinesh Jain are
liable for seizure consequently confiscation thereof.
(c) whether Kundan Cab Pvt. Ltd. is liable to pay duty
and the said goods are liable for confiscation and imposition of
penalty or not ?
(d) whether in the facts and circumstances of the case,
penalty can be imposed on the other appellants namely Shri
Bilesh Jain, Paras Mal Jain and Shri Dinesh Jain or not ?


Issue No. (a)

18. We find that it is a fact on record during the course of
inspection it was found that M/s Delhi Marketing Pvt. Ltd. did
not have any electricity connection, no plant and machinery
installed in their premises and other infrastructure for
manufacturing. The said fact is evident from the report
submitted by the concerned Superintendent during the course
of verification,
19. For better appreciation of fact, the said fact is extracted
below :-

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As it is evident from the fact that M/s Delhi Marketing
Pvt. Ltd. is not having any facility to manufacture the goods,
therefore, M/s Delhi Marketing Pvt. Ltd. cannot be held the
manufacturer of goods.

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The case of the Revenue is that as per the statement of
Shri Paras Mal Jain that M/s Delhi Marketing has got
manufactured the goods from job workers in their account. We
take note of the fact that no investigation was conducted with
job workers and no job worker has come forward to say that
they have manufacture of goods on behalf of M/s Delhi
Marketing and for the activity being job worker, M/s Delhi
Marketing has to pay central excise duty on behalf of job
worker. As said evidence is not on record and no investigation
was conducted by the Revenue to that extent, we do not find
force in the said allegation.

Further, we take note of the fact that in case, the goods
are manufactured by the job worker, the job worker is a
manufacturer and job worker is liable to pay duty, in that
circumstances, we hold that M/s Delhi Marketing is not a
manufacturer and is only a trader. Therefore, the goods cannot
be seized on the premise that the said goods are meant for
clandestinely removal without payment of central excise duty.
Hence, the seizure and confiscation of the goods seized during
the course of investigation from M/s Delhi Marketing is set
aside. Consequently, no redemption fine is imposable, Further,
no duty is payable by the appellant.
In view of this, no penalty can be imposed on M/s Delhi
Marketing, Shri Balar Jain and Shri Paras Mal Jain as
Authorized Representatives of M/s Delhi Marketing.

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Issue No.(b)
(M/s Balar Marketing Pvt. Ltd.)
20. We find that during the course of investigation certain
goods were found excess which were not entered in RG-1
register, but no further investigation has been conducted by
the Revenue to the extent that whether the said goods are
finished goods, meant for clandestinely removal.
It is the contention of the appellant that the said goods
being electrical goods are to be tested first and then be
repacked and MRP stickers are required to be affixed. It is not
coming out from the records that the said seized goods are in
form of finished goods having test report and the MRP stickers
affixed on them. In the absence of the said evidence, the
contention of the appellant is acceptable that the said goods
are not reached up to the stage of finished goods.
Consequently, they are not required to enter in the RG-1
register at that time. The learned counsel for the appellant has
submitted that the said goods have been cleared on payment
of duty, later on. In that circumstances, we hold that the said
seized goods are not liable for confiscation, consequently,
redemption find imposed on the said goods is set aside and no
penalty is imposable on M/s Balar Marketing Pvt. Ltd.
We further take note of the fact that during the course of
hearing the learned counsel for the appellant produced the
cash ledger wherein an amount of Rs.25,00,000/- has entered

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on 08.02.2012 before the date of search and an agreement to
that effect has been placed on record that the said amount is
on account of sale of plot as an advance. Further, we take note
of the fact that Rs.3,09,500/- shown in the cash book to meet
out their day-to-day expenses, which is evident from the cash
book. The remaining Rs.8,10,000/- belongs to wife of Shri
Paras Mal Jain and Shri Dinesh Jain respectively. The said
amount cannot be said the sale proceeds of clandestine
clearances of the goods in the absence of any evidence placed
on record by the Revenue. Therefore, whole of the cash seized
during the investigation is required to be refunded to the
appellants.


Issue No.(c)
(M/s Kundan Cab Pvt. Ltd.)
21. We find that it is a fact on record that during the course
of investigation, the goods were lying in the premises of M/s
Kundan Cab Pvt. Ltd. on which MRP stickers are to be affixed
and are to be repacked.
For better appreciation of the facts, the said goods
pertains to the invoice issued by the Sard Metals Pvt. Ltd. vide
invoice dated 04.02.2011 the said invoice is extracted below
for better appreciation :-

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On the said invoice, the appellant has paid the duty
Rs.3,14,497/-. As appellant is not registered with central
excise department, therefore, the appellant has not taken
Cenvat credit pertaining to the said invoice and admittedly the
goods, in question, are MRP based on which duty is to be
payable after taking the abatement of 55% by the

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manufacturer of goods, who has paid the duty. The said
amount is entitled to the Cenvat credit to the appellant as the
appellant was not registered therefore they can not avail
cenvat credit of the duty paid and duty is to be paid by the
appellant equivalent to the cenvat credit, therefore, it is
revenue neutral situation as neither appellant have taken the
credit nor they have paid the duty. It is pertinent to mention
that the assessable value of the said goods has not been
changed after affixing MRP stickers by the appellant. As the
duty remains same which has already paid by the
manufacturer/supplier, therefore, the non-availment of Cenvat
credit amounts to payment of duty by the appellant, hence,
the goods seized from the premises of Kundan Cab Pvt. Ltd. is
also not liable for confiscation, consequently, the redemption
fine and demand of duty and imposition of penalty on Kundan
Cab are not sustainable.

Issue No.(d)
(Penalties)
22. As the case has been made out by the Revenue against
M/s Delhi Marketing, M/s Kundan Cab Pvt. Ltd. and M/s Balar
Marketing Pvt. Ltd. is not sustainable, therefore, no penalty
can be imposed on Shri Balar Jain, Shri Paras Mal Jain & Shri
Dinesh Jain.

24 EX/52178-52183 OF 2019



23. In view of the above observations, we pass the following
order :-

(a) demand of duty from M/s Delhi Marketing and Kundan
Cab Pvt. Ltd. are set aside. The confiscation of cash
alleging sale proceeds of clandestine clearance of the
goods is also set aside. Consequently cash seized from
Delhi Marketing and M/s Balar Marketing Pvt. Ltd. are
required to be refunded.
(b) the goods seized from the premises of M/s Balar
Marketing Pvt. ltd. and Kundan Cab Pvt. Ltd. are not
liable for confiscation consequently, redemption fine
imposed on them are also set aside and
(c) no penalty is imposable on all the appellants.

24. With these terms, appeals are disposed of by way of
setting aside the impugned orders.

(Order pronounced in open court on 05/11/2026.)




(ASHOK JINDAL)
MEMBER (JUDICIAL)



(P.V. SUBBA RAO)
MEMBER (TECHNICAL)
PK