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2017 (3) TMI 987 - AT - Central ExciseClandestine removal - The allegation against the main appellant, M/s. Praveen Tobacco Company Ltd. is that 74988 kgs. of unmanufactured hookah tobacco and 725 kgs. of leaves tobacco (Orchha) was found short in the premises of M/s. Praveen Tobacco and 66,045 kgs. of unmanufactured hookah tobacco found short in the premises of Mittal Trading - total shortage being 1,41,758 kgs., has been used in the manufacture of 6 gm. pouches of Praveen Chhap spit, whose MRP is ₹ 1.8 per pouch and that these spit tobacco pouches have been cleared clandestinely without payment of duty - the stand of the appellant in course of proceedings before the Commissioner has been that unmanufactured hookah tobacco consists of dust, leaf, stems, nus, rawa, etc. and the same is fit only for making hookah tobacco and cannot be used for making chewing tobacco and that for making chewing tobacco, the leaf of tobacco (Orcha) is required and accordingly, the appellant’s contention is that no duty demand can be made on the basis of the shortage of 141033 kgs. of unmanufactured hookah tobacco and the duty demand based on the shortage of 725 kgs. of Orcha tobacco would be only about around ₹ 15,000/-. Held that: - We find that the demand for excise duty stands confirmed on the basis of allegation that the shortage of unmanufactured Hookah Tobacco has been diverted for manufacture of spit tobacco. Contradictory claims have been made by both sides before us, as to whether spit tobacco can be made using Hookah tobacco. The entire demand hinges on this fact. On going through the impugned order, we find that the ld. Adjudicating Authority have not dealt with this plea made by the appellant in detail. We are of the view that unless this fact is settled either by means of documentary evidence or by means of expert or by technical literature opinion, the demand becomes questionable. During the course of search on 8/6/2009 at the premises of M/s Mittal Trading company and godown of M/s Praveen Tobacco at Sonipat on 12.06.2009, samples of unmanufactured Hookah Tobacco were drawn for testing. The relevant test reports have not been made available to the appellant. We are of the view if such test reports are available, the same may throw light on the question, whether such unmanufactured Hookah Tobacco can be used for making spit Tobacco. The impugned order has not discussed, some of the serious arguments raised by the appellant, even though these were made before the adjudicating authority. We also note that these arguments are central to the demand of Central Excise duty raised in the SCN. The case is remanded to the Original Authority for denovo decision, after giving specific findings on the above points raised by the appellant - appeal allowed by way of remand.
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