9911796707
TMI Blog2024 (7) TMI 1355X X X X Extracts X X X X X X X X Extracts X X X X ..... and confirmed and the penalties imposed therein, whereas the Revenue is in appeal against dropping of part of the demand and against the benefit of Notification No.2/95-CE dated 04.01.1995 being extended to the appellant along with partly reducing the penalty under Section 11AC of the Central Excise Act, 1944. 2. Briefly stated the facts are that on specific intelligence and search of the premises of the said unit, it was observed/alleged that the appellants have manufactured and removed Toroidal transformers in Domestic Tariff Area (DTA), copper scrap, steel scrap, mylar scrap, plastic spools without payment of appropriate rate of duty of Excise, without observing the formalities prescribed and without the cover of proper invoices during the period 05.02.1999 to 30.06.2002. Based on the records and documents recovered from the appellants and other relevant parties like transporters, courier offices, buyers, etc., the Department compiled Annexures I to XIII, which contained the workings of the alleged duty liability on several counts. Accordingly, the appellants were issued with Show-cause Notice No. 02/2004 dated 01.03.2004 demanding a total duty of Rs.2,54,01,781/-. The Commissi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the Range Officer and accepted. 3.3 For the demands under Annexure III, the learned counsel submits that the Range Superintendent in his report clearly furnished the endorsement that he had verified all connected invoices which supports the appellant's contention that each of these removals are in fact duty-paid. The only objection of the Superintendent was that the date of removal does not tally with the dispatch date and the date of removal does not tally with the dispatch date because of the pattern of removals, i.e., removals effected under private documents being either preceded by a proper duty paying invoice or being followed by a duty paying invoice. This explanation has been accepted by the Commissioner in respect of other Annexure-I. IV and XII to the Show-cause-Notice, but, has been rejected without any reasoning in respect of Annexure III. For Annexure VI demands, it is stated that the Range Officer vide his report dated 14.7.2008 has confirmed that all the invoices in respect of Annexure-VI was verified, but, the only objection of the Range Officer was with reference to non-intimation of cancellation of invoice within 24 hours. Therefore, the confirmation of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e report, wherein the Range Officer has reported that there is no corroboration between the proforma invoices and the duty-paid invoice with reference to the reconciliation statement submitted by the party. On the contrary, he has held that the issue pertains to clandestine removal and Department has not undertaken proper investigation. The Adjudicating Authority has thus failed to independently consider/examine/discuss evidences brought out in the show-cause notice and hence, the findings to that extent is totally against the principles of justice and statutory law. 4.1 He further submitted that it is on record that the jurisdictional Range Officer in his report after verification of the reconciliation statement submitted by the assessee had reported that the invoice date, date of removal as claimed by the assessee does not tally with the date of despatch. It has also been reported that the figures of date of despatches shown under different Annexures are found to be not tallying with the DTA invoices. In this regard, it may be seen that the product manufactured by the assessee are toroidal transformer i.e., transformers used in the electronic/electric circuits/gadgets and it doe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he was unaware that invoices have not been issued. She also informed that she did not know whether all consignments were sent with a proper invoice. Further, according to Shri Kumardas, Sr. Executive, Logistics, whenever he is directed to prepare proforma invoice he would do so and when asked to prepare a proper invoice, he would act accordingly. On perusal of the registers and other documents recovered during investigation, it was observed that the invoices were not raised serially in as much as it was noticed that invoice No. 34 was issued on 14.05.2002; No. 13, 14A & 10A were issued on 25.05.2002; No. 11 was issued on 26.05.2002 and No. 65 & 66A were issued on 14.06.2002 while invoice No. 16 was issued on 18.06.2002. 4.3 Further, the assessee compiled the said clearances and submitted a compilation sheet along with their reply to the show-cause notice which was verified by the jurisdictional Range Officer and it was reported that the dates of the proforma invoices raised during its clearances were not tallying with the central excise invoices as contended by them. There were also no other corroborative entries to correlate and accept their contention. For example, in respect of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was filed by the department against the above cited order before the Hon'ble Supreme Court of India and the Hon'ble Supreme Court had vide order dated 22.03.2007 observed that the order of the Tribunal does not give any reason in support of the conclusions arrived at and set aside the order passed by the Tribunal and remanded the case back to the Tribunal for a fresh decision in accordance with the law. Hence the said benefit is not proper and is liable to be set aside and the exemption extended to the assessee is liable to be set aside. 4.6 Further, after considering that the assessee had already paid an amount of Rs.5,44,750/- during investigations, balance amount of Rs.9,74,860/- was held to be the total duty to be confirmed and the liability as penalty under Section 11AC was reduced to that extent. The Hon'ble Supreme Court in the case of M/s. Rajasthan Spinning and Weaving Mills has observed that "We completely fail to see how payment of the differential duty whether before or after the SCN is issued can alter the liability for penalty, the conditions for which are clearly spelled out in Section 11AC of the Act." As a result, in pursuance to the above facts and decisions of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d was in Annexure-VII where he has categorically mentioned that out of 51 cases based on the Range Officers report dated 14.07.2008 that 38 cases are deemed exports on which no duty is required to be paid, 12 cases duty was paid except for one case where the duty is confirmed. From the grounds of appeal filed by the Revenue, it is only stated that 'it appears that the Commissioner's findings on verification of these documents do not appear to be correct and the Commissioner should have confirmed the full amount'. Even in the written submissions filed by the Revenue, they do not substantiate their arguments with any relevant documents or any report of the Range Officer to allege that the amount demanded in the notice should have been confirmed. There being no other documents or verification done by the Department, the question of demanding the entire demand as per the notice does not arise. Therefore, since the Commissioner has given a detailed findings based on the Range Officers confirmation, the Revenue's appeal fails. 5.2 The amount confirmed by the Commissioner in the impugned order is as follows: (Amounts in Rupees) Annexure Amount of duty confirmed 50% of the duty Not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed invoices duly verified but invoice date (date of removal) does not tally with the dispatch date. The Commissioner having accepted such invoices for other Annexures, the benefit of doubt cannot be denied. The Commissioner having taken on record the above observations of the Range Superintendent held that 'it is evident that the assessee had effected clearances under proforma invoices without payment of duty. The assessee could not put forward any evidence to prove that the goods were properly accounted and duty was paid on clearing the same.' In view of the above, we do not find any reason to disagree with the Commissioner. 5.5 Coming to the demand at Annexure VI, the learned counsel claims that the only objection by the Range Officer was that cancellation of invoices were not intimated within 24 hours. From the impugned order at Para 23, it is very clear that the Commissioner had accepted the report dated 31.03.2009 from the Range Officer which states that duty was paid for Serial No.1,2,6 to 10 while for Serial No. 4 and 5 duty was not paid, hence duty was confirmed only for Serial No. 4 and 5. Therefore, this demand in our view needs to be sustained. 6. The second issue is w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unal for a fresh decision in accordance with law. 6. All contentions are left open to the parties. The Civil Appeals are, accordingly, disposed of". 6.1 Moreover, in the case of Santogen Exports Ltd. vs. Commissioner of Central Excise, Raigad: 2014 (312) ELT 257 (Tri- Mumbai), the Tribunal observed as follows: "Inasmuch as there is no permission granted by the Development Commissioner for the clearances made during 1995-96, the appellant would not be eligible for the benefit of Notification No. 2/95-C.E. as the concessional rate provided therein is in respect of clearances made in accordance with the permission granted by the Development Commissioner. Thus the demand of differential excise duty of Rs. 9,21,795/- is clearly sustainable in law and we hold accordingly". In view of the above, since the clandestine removals are beyond permissible limits by the Development Commissioner, the question of extending the benefit of Notification No.2/1995-CE does not arise. Hence, the entire demand of Rs.30,39,220/- is confirmed. 7. Summing up: (i) The appellant-assessee's appeal No. E/689/2009 is dismissed. (ii) Departmental appeal No. E/786/2009 is partially allowed only to the ex ..... X X X X Extracts X X X X X X X X Extracts X X X X
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