TMI Blog2019 (4) TMI 724X X X X Extracts X X X X X X X X Extracts X X X X ..... ssioner, it has been submitted by the appellant that for the said period i.e 16.8.1998 to 5.11.1998, neither samples were drawn nor any test had been conducted. Therefore, the confirmation of demand denying the benefit of exemption notification 5/98-CE is incorrect. When samples were tested by the Department, and the result indicated that the denierage declared by the appellant in clearing the goods more or less in confirmity with the test report, hence, in absence of any contra test report for the period prior to 5.11.1998 indicating different denierage of the nylon monofilaments yarn cleared, it is incorrect to arrive at the conclusion that the said yarns were of different denierage on the basis of a theoretical formula. Consequently, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se notice was issued on 28.5.1999 proposing recovery of duty of ₹ 39,44,643/- on the manufacture and clearance of 1,23,144.04 kg of nylon filaments during the period from 16.8.1998 to 5.11.1998 along with interest and penalty; personal penalty proposed on the Director under Rule 209A of the erstwhile Central Excise Rules, 1944. Both the show-cause notices were adjudicated; seized goods were directed to be confiscated and demands were confirmed with penalty. Aggrieved by the said order, the appellant filed an appeal before this Tribunal and this Tribunal vide order No. C-II/82- 83/WZB/2004 dated 8.1.2004 partly allowed the appeal of the appellant observing that what manufactured by the appellants were Nylon monofilaments yarn and reman ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emently argued that the formula adopted by the Department is incorrect and hence the same should not be accepted. Further, he has submitted that the Department has drawn 5 samples in respect of 5 different diameters of yarn and there was no prohibition to get tested the different varieties of yarn available, some of which were also dutiable and duly declared under the classification declaration filed by them. It is his contention that when the samples were drawn and tested by Dy. Chief Chemist, it is found to be in conformity with the denierage of nylon monofilaments yarn as claimed by the Appellant. There was no basis for any adverse inference and in respect of past clearance, which were neither examined nor samples were drawn and tested, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gister, monthly RT-12 returns, invoices etc. Therefore, the department was fully aware of manufacture nylon monofilaments yarn by the appellants which were exempted. In the event, department did not agree with the claim of the appellant on the classification or exemption claimed by them, samples should have been drawn and analyzed way back in 1997 itself when the classification declaration was filed as per law. In support, he has referred to the judgment of the Hon'ble Supreme Court in the case of Commissioner of Central Excise, Mumbai Vs. T.K.K. Pharma Ltd. 2006 (198) ELT 481 (SC) and Pushpam Forging 2006 (193) ELT 334 (Tri-Mum). 5. Per contra, the learned AR for the Revenue, on the other hand, submitted that the formula th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elligence that the appellant had wrongly claimed the benefit of Notification No. 5/98-CE dated 2.6.1998. The panchanama drawn on 5.11.1999 reveals that the nylon monofilaments yarn has been entered in the RG-1 register as dutiable and exempted and not denierage wise. The classification declaration filed by the Appellant it is mentioned denierage wise. The denierage is calculated at the time of clearance of the yarn on application of the formula known to the appellant. Shri Pankaj V. Rungta, Director of the appellant in his statement dated 5.11.1998 deposed that the diameter of the nylon monofilaments yarn was measured with the help of micrometer and the same was recorded in their Books of Account and converted into denierage by using the fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hether the appellants are eligible to the benefit of exemption notification No. 5/98-CE dated 2.6.1998. While initiating the investigation against the appellant, goods lying in the factory premises of the appellants were placed under seizure and samples were drawn for ascertaining denierage of the impugned goods, namely, nylon monofilaments yarn on 5.11.1998. Since the quantity of samples drawn from the seized goods was found to be in short in length, at the request of the Dy. Chief Chemist, samples were re-drawn on 23.1.1999 and sent for testing. The test report by the Dy. Chief Chemist indicating as below: - The sample is monofilament yarn of polymide (nylon) having diameter size 61 mm, denierage 614 09. 9. Later clarificatio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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