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2013 (9) TMI 56 - CESTAT AHMEDABADOnus to Prove the Demand - unaccounted fabrics and yarn - Whether duty demand can be sustained on the ground that the goods were found in a 100% EOU - Held that:- Without discharging the responsibility and without bringing any evidence on record the demand of duty on the yarn or the fabrics seized could not be sustained treating the same as the ones obtained or manufactured by a 100% EOU - No evidence had been putforth to contradict the submission of the owner of M/s. Sunrise Silk Mills that he had ceased to function in 2001 itself and handed over the building back to the owner - To demand duty on the ground that the yarn was manufactured/obtained by a 100% EOU and the fabrics were manufactured by a 100% EOU, some evidence was required. It was the department who had permitted M/s. Sunrise Silk Mills to function as a 100% EOU and therefore even if the unit had not been debonded - there had to be some return or intimation filed by the 100% EOU - It was quite possible that unit would have ceased to function earlier but there had to be some return or intimation filed by them to either Customs or to Development Commissioner or even to the banks - Since the duty demand was being raised by the Revenue on the ground that goods were manufactured/obtained by 100% EOU the responsibility to show that it was a 100% EOU who had manufactured/obtained these goods was on the Revenue which had not been discharged at all - If the Revenue could show the last return or intimation by the 100% EOU and if the quantities under seizure were the closing stock of the 100% EOU, the burden to show that it was not so would have shifted to the appellant. Duty Liability - Whether the appellant was liable to duty on the yarn which had been seized as a purchaser – Held that:- This aspect had not been examined at all by the lower authority - for this purpose it had to be go back - it was the responsibility of the appellant to show that the goods were manufactured and supplied by the M/s. CTX Textiles since it was their claim and by showing the fact that there was no octroi stamp - a prima facie case had been made out by the Revenue even though it would have been better if they were to investigate at the suppliers’ end – the appellant could have easily rebutted the observation of the Revenue that yarn could not have come to the appellant by producing an affidavit or a letter from the supplier and the issue was under litigation for the past six years - it was surprising that this had not been done till date. Goods cannot be said to have been manufactured by a 100% EOU in the case and since grey fabrics manufactured by an indigenous unit do not attract duty if no Cenvat credit has been availed - the question of duty demand does not arise - When there was no duty demand, naturally there cannot be seizure and confiscation and penalty - Therefore, as regards grey fabrics, the appeal succeeds. As regards duty on yarn, the matter was remanded to the original Adjudicating Authority for fresh decision after giving reasonable opportunity to the appellants to present their case – Decided Partly in Favour of Assessee.
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