TMI Blog2023 (12) TMI 847X X X X Extracts X X X X X X X X Extracts X X X X ..... Adv. Mr. S. Nandy, Adv. ...for the respondent ORDER 1. Heard Mr. Bhaskar Prasad Banerjee, learned standing counsel assisted by Mr. Tapan Bhanja, learned Advocate for the appellant/department and Mr. Sagar Bandopadhyay, learned counsel assisted by Mr. Arijit Chakraborty and Mr. S. Nandy, learned Advocates for the respondent/assessee. 2. This appeal was admitted on 2.7.2007 on the following substantial questions of law: (a) Whether the learned Tribunal had failed to appreciate that onus lay on the respondent to prove that the conditions imposed in Notification Nos. 4/97-CE, 5/98-CE, 5/99-CE, 6/00-CE were satisfied in the instant case ? (b) Whether in the facts and circumstances of the case, the Tribunal should have held that the Respondent had failed to discharge the onus of proving that the two conditions mentioned in the said Notifications, namely, that the goods in question had to be sold to the apex bodies by the respondent and that a certificate should be issued from the said apex bodies to the respondent at the time of the clearance of goods that the said goods were going to be used only on handloom had been satisfied ? (c) Whether the learned Trib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed on them. 6. By the aforesaid show cause notice, two other noticees i.e. noticee no.2, West Bengal State Handloom Weavers Co- Operative Society Limited (Tantuja) and noticee No.3, West Bengal Handloom and Powerloom Development Corporation Limited (Tantusree) were also required to show cause to the Commissioner of Central Excise as to why penalty under Rule 209A of the erstwhile Central Excise Rules, 1944 read with Rule 26 of the Central Excise (No.2) Rules, 2001 may not be imposed. The aforesaid show cause notice was issued to the respondent/assessee for the period from December, 1997 to March, 2002. The Commissioner of Central Excise, Haldia Commissionerate adjudicated the show cause notice by Adjudication Order dated 29.12.2003, whereby he denied exemption to the respondent/assessee and imposed central excise duty amounting to Rs.2,31,81,177/- under Section 11A of the Central Excise Act, 1944 (hereinafter referred to as the Act, 1944) and also imposed interest under Section 11AB and penalty equal to the amount of duty under Section 11AC of the Act. Penalty of Rs.10,00,000/- on each of the two other assessees were also imposed under Rule 209A of the Rules, 1944. 7. Aggrie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de payments within seven days from the date of receipt of the goods by way of cheques drawn on the said Apex bodies accounts. The requisite certificates have also been produced to the effect that such yarn would be used in the handloom industry. 5. The Commissioner in his impugned order held that though the payment of the yarn in question has been made by Tantuja and Tantusree by way of cheque but the investigation conducted by the revenue revealed that the appellants were holding sale meeting with the Tantuja and Tantusree officers and traders were also invited. Traders were directed to make payment to Tantuja and Tantusree by way of pay order or bank draft and the said Tantuja and Tantusree, after receiving payment from the traders, deduct 1.5% Commission for their services and would make payments to the yarn manufacturers by way of cheque. The Commissioner has concluded that though the sales were being shown as having been made to Tantuja or Tantusree, the same were in fact being made to traders, with the connivance of Tantuja and Tantusree. As regards second condition of the Notification requiring production of a certificate from an authorised officer of National or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Government Notification leaves no scope for any adverse inference against the appellants that the goods were being sold by them to other buyers and not to Tantuja and Tantusree. 7. As regards the second condition of the Notification, we find that the Appellants have admittedly produced the certificate from the relevant authorities to show that the goods are to be used in the handloom industry. There is no evidence on records to show that the same have been used elsewhere. In fact the Commissioner has observed in his impugned order that it was not possible for the local jurisdictional Central Excise authorities to ascertain the authenticity of such certificate. If that be so, then the certificates are required to be accepted by the revenue. Failure on the part of the revenue to produce any evidence contrary to the certificates cannot be made a ground to hold the certificate to be incorrect. 8. On the contrary the appellants have produced on record the experts opinion in the shape of letters from the members, College of Textile Technology stating that Cotton yarn in cross reel hanks are suitable for handloom industry due to two advantages viz., it can be bleached or dye ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elief to the appellants. 8. Aggrieved with the afore-referred/quoted impugned order of the Tribunal, the revenue has filed the present appeal. 9. It is also relevant to mention that the appellants herein have also filed an appeal against the impugned order of the Tribunal with respect to the co-noticee raising limited question of penalty imposed upon them under Rule 209A of the Rules, 1944. The appeal filed by the Department was allowed by a co-ordinate Bench of this Court in Central Excise Appeal No.3 of 2007 decided on 24.2.2023. Against the aforesaid judgment and order passed by a co-ordinate Bench, the concerned noticee filed a Special Leave Petition (Civil), Diary No.29915/2023 (M/s. The West Bengal State Handloom Weavers Co-operative Society Ltd. (Tantuja) vs. Commissioner of Central Excise, Haldia Commissionerate. The Hon ble Supreme Court by an order dated 11.8.2023 stayed the above-referred judgment and order dated 24.2.2023 in Central Excise Appeal No.3 of 2007 passed by the Co-ordinate Bench of this Court. 10. We have heard the learned counsel for the parties at some length. In the midst of argument, learned counsel for the appellant prayed that the matter ma ..... X X X X Extracts X X X X X X X X Extracts X X X X
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