TMI Blog2018 (6) TMI 434X X X X Extracts X X X X X X X X Extracts X X X X ..... ils does not arise. SSI exemption - rejection on account of failure to file declaration - Whether the appellant is entitled to the benefit of small scale exemption in absence of a formal declaration under N/N. 8/2003? - Held that:- n case of Notification No.8/2003, the filing of declaration is not a mandatory pre-requisite and is more of a procedural nature. Thus it is held that the benefit of small scale notification cannot be denied merely for the failure of the appellant to file the said declaration - benefit of SSI Exemption allowed. Validity of the LRs recovered from various transporters as evidence against the appellant - If the quantum allegedly received by the appellant on the strength of the LRs recovered from the transporters and other third parties is correct or otherwise? - Held that:- It is seen that the addresses appearing in LR could not be verified as some of the addresses were non-existent or bogus - decided against appellant. If the value of goods declared by the appellant is correct or otherwise? - Held that:- As per the statement of Shri Sabir Kadir Khan, manager of the said Services, the said Shri Sabir Kadir Khan also deposed that the said goods were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ued that the Revenue has not produced any evidence that the product manufactured by them was wire, as only the products in coil forms can be considered wire. He argued that in the panchnama dated 14.9.2006 drawn in the premises of the appellant, no machinery for winding of drawn/redrawn product into coil form (coiling machinery) has been found installed in the factory. He relied on the statement dated 11.10.2006 of Shri Navin Agarwal, partner of M/s. Bahubali Metals and the statement dated 15.9.2006 of Shri Tejraj Jain, partner of M/s. Vimal Metal Corporation, to assert that wire rods after redrawing got into required sizes and cleared to customer. He argued that on the basis of above evidence, it is apparent that no wire comes into existence. He argued that the burden of proving that the activity amounts to manufacture is on Revenue and the said burden has not been discharged insofar as the Revenue has failed to establish that the product manufactured by the appellant was in coil form to qualify as wire. He relied on the decisions of Apex Court in the case of Garware Nylons vs. UOI 1996 (87) ELT 12 (SC) and in the case of Ponds India vs. CTT, Lucknow 2008 (227) ELT 497 (SC). ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able, especially because non-verification was done by the department from the particulars of dispatch available on the LRs from the buyers. He further argued that the transporter had categorically stated that they never accepted the goods unless they were accompanied by delivery challans. However, no delivery challans were found with the said LRs. In these circumstances, the authenticity of LRs is under question and it does not become reliable evidence. He further argued that there is no evidence of the alleged quantity of material processed in the factory or that the raw material figuring in the LR was actually received in the appellant s factory. The appellant also challenged the quantification of the demand. He argued that if the value of clearance of wire rods, then the total demand would be substantially reduced after grant of small scale exemption. In support of the said claim, the appellant has argued that no duty was payable on SS wire rods. He argued that drawing/redrawing of SS wire rods into rods/wires does not amount to manufacture. He relied on the decision of Apex Court in the case of CCE vs. Technoweld Industries 2003 (155) ELT 209 (SC). He further argued that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e goods is made by private tempo or lorry for which transportation charges were borne by the appellant and the job charges were being paid through cheque. He pointed out that the value of goods dispatched by the appellant was verified on the basis of purchase documents of M/s. Sanjay Steel Centre. He further relied on the statement of Shri Sanjay V. Jain of M/s. Sanjay Steel Centre, Shri Navin Agarwal of M/s. Bahubali Metals, to assert that various persons were sending SS rods and SS wire rods to the appellant for cutting, polishing and redrawing purpose. He pointed out that verification of all the names appearing in the LRs could not take place as out of 28 traders, 18 addresses were found fictitious/nonexistent. Moreover, during verification of one such address of M/s. Dhiraj Metal Corporation, it was found that the proprietor of the said Corporation, Shri Narendra Chunilal Shah denied having done any transaction with the appellant. He refused to own the delivery challans containing name of the said Dhiraj Metal Corporation. He further pointed out that in the declaration claimed to have been filed by the appellant was a fraud as at the material time, the division where the said d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hey had no coiling machine and thus question of making coils does not arise.We find substantial force in the arguments of the appellant. The onus of establishing that the product cleared by them after processing was wire, it is essential to establish that the same was cleared in 'coil' form. In absence of the evidence that the product cleared by them was in 'coil' form no liability can be fastened on the appellant in respect of the processing of 'Steel wire rods'. 9. The second issue which needs determination as if the benefit of Notification 8/2003 can be denied on account of failure to file declaration. The Revenue has relied on the decision of Apex Court in the case of Eagle Flask Industries (supra) to deny the benefit on account of appellant s failure to file the declaration. It is seen that Notification No.53/1988-CE mandated filing of the said declaration as is apparent from para 6 of the decision of the Apex Court, which is reproduced below:- 6.We find that Notification 11/88 deals with exemption from operation of Rule 174 to exempted goods. The Notification has been issued in exercise of powers conferred by Rule 174A of the Rules. Inter alia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arges for such goods were also paid by the consignees receiving the goods on the strength of LRs. In case of transportation of goods to Bhivandi, the transportation charges were paid by the appellant. The details of LR, party s name, quantity of material dispatched and transportation charges were maintained by the transporter M/s. Palghar Golden Transport Service. LRs are made by transporters but the Delivery challans are made by the manufacturers. As per the statement of Shri Sabir Kadir Khan, manager of the said transport Services, the said goods were cleared by the appellant along with supporting delivery challan. Sh Shiv Gopal Tewari the manager of M/s Perfect Transport Company has also deposed that thay no consignments are booked without accompanying challans. It is seen no challans were recovered along with the LRs. This creates a doubt regarding reliability of the LRs. These documents have been recovered from third party. No corroborative evidence has been recovered from the appellant's premises or from appellant's custody. Verification from the buyers has not been done. In these circumstances no reliance can be placed on these uncorroborated documents relied by the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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