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2009 (8) TMI 908

..... hey even did not avail the Cenvat credit on the inputs utilised for the manufacture of those tanks - Held that: - the appellants had not sought proper advice prior to 31-1-2006 and were under the impression that they would not be subjected to the above liability and under that genuine belief did not bother to seek or obtain any legal advice till then. The party did not make any attempt to appraise itself of the correct situation of law cannot be a ground to say that they did not know that they were liable to pay the duty or to contend that the belief was genuine and bona fide. It was necessary for the appellants to appraise themselves of the correct position in law in relation to their duty liability. Merely on fanciful imagination the asse .....

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..... de its order dated 6th December, 2004. In the meanwhile, however, the appellants paid the entire duty amount on 31st January, 2006. The duty amount relates to the period from October, 1998 to March, 2002. 3. The appellants are SSI unit and availed exemption in relation to the payment of duty while availing the Cenvat credit on their inputs. M/s. Indian Oil Corporation had placed work order for fabrication of storage tank for their retail outlet and they were accordingly manufactured by the appellants from October, 1998 to March, 2002. There is no dispute that the transformation of MS plates which were supplied by the IOCL to the appellants for the purpose of fabrication thereof to the storage tanks amounted to manufacture and it attracted t .....

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..... lants on 23rd and 20th December, 2002 of all the facts regarding manufacture of such storage tanks by the appellants for supply thereof to IOCL were revealed to the Department and consequently, a show cause notice came to be issued on 2nd April, 2003 after completing the investigation. 5. After hearing the parties, the adjudication order was passed on 16th December, 2003. The contention of the appellants that they were under a bona fide belief that they were not liable to pay duty and they were merely provider of skilled labour is disputed and denied by the respondent. Learned Advocate appearing for the appellants however fairly submitted that the claim regarding the duty liability on the manufacture of storage tanks supplied to IOCL by the .....

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..... ppellants were manufacturing similar storage tanks for other parties in respect of which the appellants had paid duty, they had no reason to evade duty in relation to storage tanks in question apart from that they were under bona fide belief in respect thereof that they had no duty liability. 6. Learned Jt. CDR on the other hand submitted that the authorities below after taking into consideration the contentions on behalf of the appellants have rightly arrived at finding about the intentional evasion of payment of duty by the appellants and therefore, there is no scope for interference in the impugned order. As regards the nature of the work, it is his contention on behalf of the respondent that the work contract which was preceded by the t .....

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..... liability and also about the fact that the manufacture thereof was by the appellants. Obviously, therefore, it was within the knowledge of the appellants that before clearing such manufactured goods, it was necessary for the appellants to pay excise duty thereof, but in fact, they cleared the products without paying duty as well as without disclosing the said fact to the Department in their regular returns. Records nowhere disclose that the contracts between the appellants and other parties were different from the one with IOCL. To a specific query in that regard, it has been clearly stated that records nowhere reveal of having led any evidence to the contrary by the appellants in that regard. In the background of these facts merely because .....

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..... re to clear the duty liability in that regard cannot be held to be bona fide. 8. The contention that non-availment of Cenvat credit would disclose absence of mala fide or intention to evade the payment of the duty is without any substance. Merely because the assessee does not avail concession which was otherwise available, that itself would not lead to the conclusion that there was intention to pay duty. If we take into consideration all the facts on record in totality the non-availment of Cenvat credit in the case in hand cannot lead to the conclusion that the appellants had no intention to evade payment of duty. It could be even a calculated move to evade payment of duty that Cenvat credit was not availed of. 9. The law on the point as to .....

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..... to assume that he had no liability to pay the duty. In the matter in hand, admittedly, the appellants were paying duty in relation to similar storage tanks manufactured for other parties. In this background, it was necessary for the assessee to disclose the ground for distinguishing the work of manufacture of the storage tanks for IOCL from others. Undisputedly, there is no material placed on record in that regard. 11. As no other ground is canvassed for challenging the impugned order, we find no case made out to interfere with the impugned order and therefore, the appeal fails and is dismissed. 12. Before we part with the appeal, we however, need to observe that in order to enable the appellants clear their dues within the period of next .....

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