TMI Blog1988 (11) TMI 223X X X X Extracts X X X X X X X X Extracts X X X X ..... goods as ACSR conductor code panther size rejected quantity of two drums with total value of Rs. 31,4999.99. The driver also produced one goods receipt No. 13718, dated 14th July, 1981 issued by M/s. Pindi Goods Transport Co. Faridabad, one form No. 38 (pertaining to sales-tax) and one proforma invoice No. 523, dated 14th July, 1981 issued by M/s. Indian Aluminium Cables Ltd., Faridabad, showing the description of the goods as two drums, weighing 4.197 metric tonnes rejected Panther conductor (greasy and whether damaged) issued in the name of M/s. Sapna Enterprises, 4935, Phatak Namak, Hauz Qazi, Delhi-6. The truck driver could not produce any central excise documents in respect of the said consignment. The truck driver, Shri Raj Kumar son of Shri Bani Singh, in his statement stated that the goods were loaded on 14th July, 1981 from the factory premised of M/s. Indian Aluminium Cables Ltd., Faridabad, but no central excise document was given to him by the party. On being asked, the appellant failed to produce any central excise records showing the clearances and payment of duty on the said goods. Shri Ramesh Chander Aggarwal, Asstt. Manager and the authorised signatory stated th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ghaziabad factory on payment of duty and stored in the godown of M/s. Promain Ltd., Faridabad. The assessee also submitted the details of such goods showing serial number of drums, gross/nett weight and company of manufacture, etc. which could be tallied with the details given in their letter dated 30th July, 1981. The two drums cleared under challan No. 523 dated 14th July, 1981 weighing 4.197 metric tonnes did not tally with any of the weights shown in the details given by the party in their letter, dated 30th July, 1981. Further the identification marks and the quantity of drums seized on 14th July, 1981 and 20th July, 1981 did not tally with those mentioned in the details given by the party in their letter, dated 30th July, 1981. The assessee s plea taken in their letter, dated 30th July, 1981 was, therefore, not tenable. Even the godown of M/s. Promain Ltd. was situated within the four-walls of M/s. Indian Cables Ltd. having a common exit and under the exclusive control of M/s. Indian Aluminium Cables Ltd., Faridabad and no D-3 intimation for the receipt of the goods in their factory was given to the department and no statutory records were maintained. Thus M/s. Indian Alumini ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 173-H and 173-L of the Central Excise Rules, 1944. (iii) No D-3 intimation of these 26 drums was submitted to the department. (iv) In the face of their own admission in their letter, dated 8.11.1977 purported to have been addressed to the Range Officer the said 26 drums of ACSR (Panther) conductor were completely deteriorated and not fit for despatch and for which they had sought permission for rewinding. They could not produce any conclusive evidence to that effect. (v) The markings given on the drums were of new origin and to give them old look foreign material like grease and dust was thrown on the painted marks. (vi) Serial numbers given on the drums and weight mentioned thereon did not tally with the particulars given on the original gate passes produced by the party in support of the plea that these had already been paid duty. (vii) The said quantity of 26 drums was never shown in the annual stock taking report as signed by the party and duly verified by the departmental officers in the balance-sheets of the party and there was nothing forthcoming to believe as to why the said goods were lying in the store for the last 7 to 8 years and as such it appeared that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a) Pvt. Ltd. at 15/3, Mathura Road for storage of duty-paid conductors. When the new management took over the management of the company, 58 drums of ACSR conductors (Panther) which were manufactured at Ghaziabad in the year 1972-73 were lying in its duty-paid godown at M/s. Davis and White and M/s. Promain Ltd. These had been manufactured for the supply to various State Electricity Boards but had not been supplied by the previous management and were lying in the duty-paid godowns. They had to shift these duty-paid drums to the premises of M/s. Promain Ltd. as the management of M/s. Davis and White desired their clients to vacate their premises and in this connection, the appellant had relied on the correspondence which the appellant had with the central excise authorities and in particular a letter, dated 8th November, 1977 whereunder they had sought permission of the excise authorities to bring those goods to their factory for reconditioning in accordance with the provisions of Rule 173-H. No action was taken by the excise authorities. With the passage of time the said conductors deteriorated and it was no longer commercially feasible to recondition them and the goods had to be re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd various other Govt. undertakings and only goods tested according to ISI specification are sold and others which do not confirm the standard are rendered unfit for use as conductor and thus become more scrap. (vii) Only scrap which has arisen at various stages of the process of manufacture had been removed from time to time after due intimation to the concerned Excise Officer and this fact can be ascertained by referring to the RT-5 returns being filed by them. Scrap cannot be termed as manufactured nor the same can be termed as goods and in this respect they placed reliance on the decision of the Bombay High Court in the case of Indian Aluminium Co. v. A.C. Bandhopadaya 1980 Cencus 178-D and also to the orders of the Central Board of Excise and Customs In Re: M/s. Wire Cond. Products Pvt. Ltd. (1980 E.L.T. 789). 3. At the time of personal hearing before the adjudicating authority, the contentions were again reiterated. 4. The learned adjudicating authority did not accept the contentions of the appellant. He had fully gone through the correspondence with the Electricity Boards stationed at Agra, Nainital and Haldwani. The goods purported to be in the form of scrap were in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fiscated the truck. He had further ordered the demand of central excise duty amounting to Rs. 89,712.40 as basic excise duty plus Rs. 4,485.62 as special excise duty on 52.772 metric tonnes ACSR conductor (Panther) valued at Rs. 8,97,124/- (which also includes the seized and confiscated quantity of 4.197 metric tonnes + 10.645 metric tonnes) which had been manufactured and deliberately cleared with the intent to evade central excise duty in the guise of scrap. M/s. Indian Aluminium Cables Ltd. had also manufactured and stored 26 drums of ACSR conductor (Panther) weighing 55.265 metric tonnes valued at Rs. 9,39,505/- involving central excise duty of Rs. 98,648.13 which they had not accounted for in the central excise statutory accounts and seized on 12.11.1981 in contravention of the central excise rules. He had ordered the confiscation of the said goods but had ordered the release on payment of redemption fine of Rs. 2,00,000/- within one month from the date of receipt of the order. He had also mentioned that in the second show cause notice the assessee had cleared ACSR conductors valued at Rs. 29,81,516.01 in the garb of aluminium scrap during the period 1977-78 onward till 1980-8 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r metric tonne. He has argued that the same appears on page 150 of the paper book. Shri Khaitan has argued that there was no justification for the levy of the excise duty, the fine in lieu of confiscation and penalty. In the alternative, he has pleaded that the same were on the excessive side. 8. Shri V.M. Doiphode, the learned senior departmental representative, has relied on the orders passed by the learned Collector. He has relied on the statement of Shri R.C. Aggarwal, Asstt. Manager and further stated that he retracted his earlier statement made on 30th July, 1981 i.e. after 16 days. The learned senior departmental representative argued that when the actual weight was available, there was no point in going to the notional basis. Shri Doiphode, the learned senior departmental representative, stated that the serial numbers do not tally and as such the plea of the appellant that the goods seized were rejects by the Electricity Boards should not be accepted. He has also argued that the goods where the same were stored was a part of the factory. He has referred to the ground plan of the factory. He has also argued that the appellant did not follow any procedure prescribed under t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a very higher figure. Shri Khaitan has pleaded for the acceptance of the appeals. 10. We have heard both the sides and have gone through the facts and circumstances of the case. There are two show cause notices in the matter before us. The first show cause notice is, dated 8th January, 1982 which pertains to intercepting of truck No. DLL-8007 loaded with a consignment of two drums of ACSR conductors falling under Tariff Item No. 33-B(ii). There was some subsequent seizure of the goods from the factory godown on 20th July, 1981. The appellant s main defence is that the management of the company had changed its hands in April, 1973 and the present management also took over another company, namely, M/s. Promain Ltd. situated adjacent to the factory premises of M/s. Indian Aluminium Cables Ltd., the appellant before the Tribunal, and prior to the take over, M/s. Indian Aluminium Cables Ltd. had a central warehouse at the premises of M/s. Davis and White (India) Pvt. Ltd. at 15/3, Mathura Road for storage of duty-paid conductors. When the new management took over the management of the company, 58 drums of ACSR conductors (Panther) which were manufactured at Ghaziabad in 1972-73 were l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntity of 4.197 metric tonnes + 10.645 metric tonnes). We have also considered the valuation aspect in the matter. The valuation adopted at Rs. 17,000/-per metric tonne is correct in law and no interference is called for. The learned advocate s argument that a single sale instance should not be taken into account is not tenable in view of the Hon ble Supreme Court s judgment in the case of A.K. Roy and Another v. Voltas Ltd. reported in 1977 E.L.T. J-177 where the Hon ble Supreme Court had held that the determination of the wholesale cash price may not depend upon the number of wholesale dealings. The quantum of goods sold by a manufacturer on wholesale basis is entirely irrelevant. The fact that such sales may be few or scanty does not alter the true position. In view of these observations, we confirm the findings of the learned adjudicating authority on valuation. 11. We now come to the show cause notice, dated 11th May, 1982. We have considered the arguments of both the sides. Shri Khaitan, the learned advocate, had argued that the adjudicating authority did not examine the existing 26 drums. We have perused the evidence on record in this regard. It is not disputed that permiss ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
