Home Case Index All Cases Central Excise Central Excise + HC Central Excise - 2022 (9) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (9) TMI 561 - HC - Central ExciseWaiver of penalty imposed in terms of Rule 209A of the erstwhile Rules read with Rule 26 of the Central Excise Rules, 2001 - benefit of the notification relating to issuance of certificate that the yarn is to be used only in handlooms - whether the benefit of certain notifications issued by the Department were misused and the respondent/assessee being a party to the modus? - HELD THAT:- The adjudicating authority on analysing the documents available on seizure and on scrutiny of the statements which were recorded from various persons, pointed out that the purchasing bills instead of delivering the cross reel hank yarn to the respondent and the noticee no.3, the apex bodies, delivered them directly to various trading concern who appear to be merchants and traders of yarn and not handloom weavers. The respondent has not controverted by producing any evidence to this alleged conclusion that a modus has been adopted by which the respondent received a commission and ultimately the yarn which was to be distributed to handloom weavers were taken of by the trades and other agencies. Thus, on analysing the evidence the adjudicating authority held that the system was evolved only to ensure that the sale should look like a sale from the spinning mill, the noticee no.1 to the respondent, the noticee no.2 and this was done in order to avail the benefit of exemption whereas the actual sale took place between the spinning mill and the private traders while the respondent and the other apex society merely acted as a commission/selling agent thereby earning commission at the rate of 1.5% as profit. Thus, the adjudicating authority records that this point could not be controverted by the respondent neither at the time of making written submission nor at the time of personal hearing. The adjudicating authority held that the certificates declaring that the yarn is going to be used only on handlooms as issued by the respondent and the other apex society are not based on factual verification but only based upon the certificate issued by the spinning mill concerned. Thus, the adjudicating authority held that the conditions stipulated in the notification for the purpose of exemption are not favourable in the case on hand - The tribunal observed that the goods were purchased by the respondent, apex body for further distribution to traders who further sold the same to ultimate handloom weavers but might be located at the interior of the country having no access to the respondent/apex body for direct purchase of the goods. With regard to the certification which was also one of the conditions under the notification, the learned tribunal has not examined the aspect pointed out by the adjudicating authority that the certificate issued by the respondent and the other apex body was not based on any verification done by them, but solely based upon the certificate issued by the spinning mill. The order passed by the tribunal is utterly perverse, as it has not dealt with any of the findings which has been rendered by the adjudicating authority by appreciating the facts and evidence brought on record - there are no hesitation to hold that the tribunal committed a serious error in interfering with the order of the adjudicating authority. Appeal allowed - decided in favor of Revenue.
|