TMI Blog2006 (11) TMI 426X X X X Extracts X X X X X X X X Extracts X X X X ..... the case 4. Brief facts of the case as set out in the Commissioner s order, are as follows : (a) The appellant is a processor of fabrics and they have done processing on behalf of several persons referred to as merchant manufacturers. (b) When the officers visited by surprise on 17-3-1997, they found stock of processed fabrics, in excess of what was accounted and seized 308 pieces of manmade fabrics measuring 28674 L. Mtrs. valued at Rs. 4,87,458/-. (c) They also found two private notebooks maintained at the office of the Printing Master one notebook Mayur maintained party wise having details of lot number, number of pieces, variety, design number etc., pertains to the year 1996 and another notebook marked as No. 2 maintained variety wise having details of date, lot number, number of pieces, variety, name of the party, etc., pertains to the year 1995. The lot register maintained were found manipulated. (d) The lot register maintained by them were ingeniously manipulated e.g., in a case where 60 pieces were removed it was altered as 6.0 by putting a decimal point after 6, thus actually accounting only 10% of the production and clearance. (e) The comp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also imposed penalties under Rule 209A of the Central Excise Rules, 1944 on the 42 merchant manufacturers who admitted receipt of the processed fabrics illicitly cleared by the mills without cover of Central Excises invoices and without payment of Central Excise duty. 6. The appellants challenged the order of the Commissioner inter alia on the following grounds : (a) 308 pieces which were seized by the officers did not reach RG-1 stage and therefore seizure and subsequent confiscation are not legal. (b) The two private notebooks were not maintained by the mills; this was found in the cabin of the printing master; this is the work of some disgruntled employees to discredit the reputation of the company; (c) No corroborative or supportive evidence to confirm the contents of the alleged private records have been produced. (d) The statements were taken under duress; the fact that merchants manufacturers were made to pay Central Excise duty forcibly by the officers is a clear indication of their violence at the time of recording of statements. (e) The cross-examination of various persons/officers as per the appellants request were denied; 7. It is to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also submitted that as the duty has already been paid there is no determination of duty short levied or short paid arises under sub-section (2) of Section 11A. Section 11A (2B) reads as under : Section 11A. Recovery of duties not levied or not paid or short-levied or short-paid or erroneously refunded (1) ...... (2) ........ (2A) ....... (2B) Where any duty or excise has not been levied or paid or has been short-levied or short-paid or erroneously refunded, the person, chargeable with the duty, may pay the amount of duty before service of notice on him under subsection (1) in respect of the duty, and inform the Central Excise Officer of such payment in writing, who, on receipt of such information shall not serve any notice under sub-section (1) in respect of the duty so paid : Provided that the Central Excise Officer may determine the amount of short payment of duty, if any, which in his opinion has not been paid by such person and, then, the Central Excise Officer shall proceed to recover such amount in the manner specified in this section, and the period of one year referred to in sub-section (1) shall be counted from the date ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mine the duty short levied or non-levied. Even the investigating officers of such cases are not the authorities who determine the short levy or non-levy but this functions and powers are only with the competent adjudicating authorities. 9.5 The legislative intention of introducing Section 11AC has two aspects. It aims to act as a deterrent to the evaders and at the same time to reduce the discretionary powers of the adjudicating authority in matters relating to imposition of penalty. Once the adjudicating authority finds that the ingredients of offence as narrated in Section 11AC are held to be proved then he has no option but to impose penalty equal to the duty evaded. 9.6 In the present case as seen from the appeal petition the appellants are questioning the duty demand on the illicit removals by assailing the evidence relied upon. In other words they are questioning the confirmation of duty which has already been paid. 9.7 In the liberalized excise where lot of faith is placed on the assessee and the control by the officers is minimal. In case of willful evasion, if the evader is let off without any penalty merely on the ground that he has paid the duty evaded before issue ..... X X X X Extracts X X X X X X X X Extracts X X X X
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