TMI Blog1991 (6) TMI 167X X X X Extracts X X X X X X X X Extracts X X X X ..... nces, all sorts, falling under Item No. 29A(3) of the First Schedule to the Central Excises and Salt Act, 1944, (i) manufactured and. removed 107 compressors valued at Rs. 59,170 under cover of Central Excise Re-issue duty paid gate passes on which no Central Excise duty due was determined and paid and without accountal in the. Central Excise statutory records, and (ii) manufactured 24 compressors valued at Rs. 13,200/-, out of compressors blocks and removed the same without determination and payment of Central Excise duty due thereon and without cover of Central Excise gate passes and without accountal in the Central Excise statutory records during the period from April, 1976 to April, 1978. 3. In view of the above facts a show cause notice was issued to the appellant alleging the contraventions of the provisions of Rules 9(1), 173G(1), 173G(2) read with Rule 52A, Rule 173G(4) read with Rules 53, 55, 173H and Rule 226 of the Central Excise Rules, 1944, whereby the appellant was asked to show cause as to why the aforesaid duty should not be paid by them and the penalty should not be imposed under Rule 173Q of the Central Excise Rules. The appellant submitted a reply and after a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pany, the same was sent by them without completing the repairs within the period of three months and the said company had returned the same within one month of the receipt of the same. In such circumstances, the adjudicating officer, without any evidence on this behalf, stated that these compressors were removed without payment of the duty. Shri Mookherjee contended that without any such verification of the statements furnished by the appellant, no such conclusion can be arrived at only on mere presumptions and conjectures. In this connection, Shri Mookherjee relied on the decision of the Supreme Court reported in AIR 1971 SC 1898 wherein their Lordships held that suspicion cannot take the place of proof. He also relied on the decision of the Supreme Court reported in AIR 1971 SC 746. He contended that the Supreme Court had held in that case that the finding of the revenue authorities based on pure assumptions and conjectures and on no evidence whatsoever should be quashed. Relying on the abovesaid decisions of the Supreme Court, Shri Mookherjee urged that the whole matter in this case was decided by the learned Collector on the basis of assumptions and presumptions. He had not giv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... herefore, contended that the order is vitiated on this count. 6. As far as the second point is concerned, Shri Mookherjee contended that the charge against the appellant is that they have manufactured 24 compressors and had removed them without payment of duty. m this regard, Shri Mookherjee took us through the relevant portion of the discussions made in the order. It was only stated by the adjudicating authority that he was not inclined to accept the argument put forward by the said firm (the appellants) and he held that the firm had manufactured those compressors and removed them without payment of duty. It was, therefore, contended that the order did not show as to what was the contention put forward by the appellant and as to why the same was disbelieved by the learned adjudicating authority. He, therefore, contended that the order is not a speaking order as the same has not given the reasons for disbelieving the contention of the appellants. He also drew attention of the Bench to the portion of the impugned order where the learned adjudicating officer has stated that 50 nos. of compressors were lying with the applicant firm. He stated that the correct number of compressors w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... there may be a suspicion, that suspicion will not take the place of proof and in the facts and circumstances of this case, this is not a case where remand is justified. Accordingly, he stated that the appeal may be allowed. 8. The learned JDR Shri A. Choudhury appearing for the department contended before us that under the Trade Notice, the appellants had three months time to get the articles repaired and if the articles could not be repaired then the abovesaid period of three months could have been got extended by the appellant by obtaining the permission of the authorities concerned and the time limit would go upto six months. Shri Choudhury, in this connection, pointed out that the conduct of the. appellant in sending these goods within a period of one month and then the particular goods having been cleared for five times clearly goes to show that they have removed the goods without payment of duty. 9. The learned J.D.R. also contended that the appellant had not intimated the Excise authorities while they were sending the goods even when the prescribed period of three months had not yet been over. He also contended that the abovesaid circumstances which are clearly discusse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acture of 24 compressors is concerned, Shri Choudhury contended that the learned adjudicating officer, on page 21 of the order, has given clear reasoning to come to the abovesaid conclusion. He further added that the appellants did not account for these 24 compressors blocks which are raw materials for manufacture of compressors and as such he contended that the findings arrived at by the learned adjudicating authority is justifiable on the facts and circumstances of this case. 11. We have heard the submissions of both the sides. As far as the allegation of removal of 107 compressors is concerned, the learned JDR Shri A. Choudhury contended that when the compressors were sent to the appellant company the appellants could keep them for a period of three months for repair and if the same could not be repaired within three months the time could be got extended to six months. But Shri Choudhury contended that in this case the appellants had submitted a statement which showed that the compressors were returned even after one month and as such the appellants plea of returning the compressors to the firm and getting back the same again is only imaginary. Hence, he contended that the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ut determination and payment of Central Excise duty. 14 In disposing of the argument advanced by the appellant in this regard, the learned Collector observed as follows :- Regarding the charge of manufacture of 24 compressors out of compressor blocks supplied by the said concern, I am not inclined to accept the argument put forward by the said firm in this regard and hold that the said firm had manufactured these compressors and removed them without payment of duty. I also find that Shri P. Sur, Director of the said concern who had come for rescue and pleaded for dropping the charge against the said firm had not been successful in bringing home the theory of the defence based on the arguments aforesaid. 15. But the appellants in their reply to the show cause notice had explained the matter as follows :- "Out of 52 Compressors : (i) 21 had been imported by the said concern. (ii) 12 had been manufactured by the said concern long before the issue of Show Cause Notice. (iii) 19 had been manufactured by said firm long before the issue of the instant Show Cause Notice. (m) It was found in the private material requisition register marked 1C/17 (compressor repair khata) i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... compressors had been either imported or manufactured by the said concern or by the said firm long before they came for repairs after payment of Central Excise duty on these compressors when initially cleared after manufacture. 16. It is thus seen that the learned Collector had not examined the contentions put forth by the appellant and had summarily rejected the same without assigning any reasons. In the decision reported in AIR 1976 SC 1785, the Supreme Court held as follows :- It is now settled law that where an authority makes an order in exercise of a quasi-judicial function, it must record its reason in support of the order it makes. Every quasi-judicial order must be supported by reason. The rule requiring reasons to be given in support of an order is, like the principle of audi alteram partem, a basic principle of natural justice which must inform every quasi-judicial process and this rule must be observed in its proper spirit and mere pretence of compliance with it would not satisfy the requirement of law. 17. It is thus seen that the above order which is not supported by reasons is not a speaking order and is not in accordance with law. 18. This takes us to t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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