Custom, Excise & Service Tax Tribunal
Cce, Delhi-Iii vs M/S.Agr Steel Strips Pvt. Ltd on 22 September, 2015
THE CUSPTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, NEW DELHI, PRINCIPAL BENCH NEW DELHI
Date of Hearing/ Decision:22.09.2015
Excise Appeal No.2621/2006-EX (DB)
[Arising out of Order-in-Appeal No.128/GRM/GGN/2006 dated 29.11.2006 passed by the Commissioner of Central Excise,Delhi-III]
CCE, Delhi-III Appellants
Vs.
M/s.AGR Steel Strips Pvt. Ltd. Respondent
Appearance:
Rep. by Shri R.K. Grover, DR for the appellant. Rep. by Shri Ram Chander Choudhery, Advocate for the respondent.
For approval and signature:
Honble Smt. Sulekha Beevi C.S., Member (J) Honble Shri B. Ravichandran, Member (T) 1 Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?2
Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?3
Whether Their Lordships wish to see the fair copy of the Order?4
Whether Order is to be circulated to the Departmental authorities?
Coram: Honble Smt. Sulekha Beevi C.S. , Member (Judicial) Honble Shri B. Ravichandran, Member (Technical) Final Order No.53102/2015 dated:22.09.2015 Per B. Ravichandran:
Revenue is in appeal against the order-in-appeal dated 29.11.2006 passed by the Commissioner (Appeals).
2. The brief facts of the case are that the respondent are engaged in the manufacture of cold rolled steel strips liable to central excise duty. During the course of verification of the records of the respondent, a shortage of 799.535 MTs involving central excise duty of Rs.17,90,958/- was found. This shortage was worked out based on the opening balance, dispatch, receipt, job work transactions, work in progress, etc. Proceedings were initiated against the respondent alleging clandestine removal of finished goods found short. The Original Authority confirmed the demand and imposed equal penalty. On appeal, ld. Commissioner (Appeals) vide impugned order dated 29.11.2006 set aside the original order and allowed the appeal. Aggrieved by the said order, the Revenue is in appeal. In the appeal, it was contended that the ld. Commissioners (Appeals) erred in finding that the charge of clandestine removal of dutiable goods cannot be held proved on the basis of assumptions and presumptions. The Revenue contended that the ld. Commissioner (Appeals) should have considered the statements given by the different persons involved in clandestine removal of the goods. The job work register and challans were not reliable as facts of removal to job work was not corroborated by the party during verification. The investigation proved that the job work challans and entries in the work register were fake and could not be relied upon to show the materials found short were actually sent for job work. The only plausible explanation for shortage is clandestine removal of these goods.
3. When the matter came up for hearing, ld. Counsel for the respondent contested the maintainability of the appeal itself. He stated that the impugned order was passed on 25.04.2006.The appeal against the said order was filed by the Commissioner on 4.8.2006. In terms of the provisions of Section 35 E of the Central Excise Act, 1944, an appeal against the order passed by the Commissioner (Appeals) can be preferred only on a decision by the Committee of Commissioners. In the present case, there is no such decision by such Committee in terms of the said section. The appeal filed by the Commissioner without review decision by the Committee of Commissioners is not an appeal and as such, the appeal is not maintainable. On merits, ld. Counsel for the respondent contended that well before the issue of show cause notice itself, they have explained in detail about the shortage found during the visit of the officers vide their letter dated 31.05.2002. Ld. Counsel further pleaded that the Directors of the Company have repeatedly stated in their submission that there is no shortage as mentioned in Panchnama dated 19.04.2002 and have in fact filed re-conciliation statement of stock. It was further contended that the reliance placed by the Original Authority on the statements of their transporters is neither correct nor relevant. The transporters statement did not accept any unaccounted clearances of their finished goods to support the allegation of clandestine removal. If at all, they have only disputed the movement of goods for job work and denied their trucks being mentioned in the challans. The ld. Counsel pleaded that the respondent was not allowed to cross-examine the trucks owners and the original authority did not give any findings on this.
4. The ld. Counsel further submitted that the ld. Commissioner (Appeals) had examined the facts of the case in detail and concluded that other than the alleged shortage, as indicated in the Panchnama, there is no corroboration whatsoever to establish the charge of clandestine removal of the excisable goods.
5. Ld. AR reiterated the grounds of appeal. Regarding the maintainability of the appeal, he argued that though the original appeal was filed by the Commissioner, later on a misc application no.146 of 2009 was filed before the Tribunal to state that the Committee of Commissioners have approved the appeal on 12.02.2009 and as such, the appeal already filed on 4.2.2006 by the Commissioner should be taken as authorized by the said Committee. The said misc. application was disposed by the Tribunal on 27.03.2009. The Tribunal observed that there is no objection for any discrepancy in the maintainability from the party when the application for condonation of delay was considered favourably. Therefore, the misc. application is infructuous and does not call for any order otherwise. In these terms, the misc. application was disposed of.
6. Ld. AR submits that since the appeal has been taken on record after condonation of delay, the question of maintainability of such appeal cannot be agitated again by the respondent. On merits, he pleaded that the Commissioner (Appeals) erred in allowing the appeal. Based on the evidences on record, the original order has to be restored.
7. Heard both the sides and examined the appeal records.
8. We consider the maintainability of the appeal first. During the relevant time, the appeal against the Commissioner (Appeals) order, when filed by the Revenue before this Tribunal, has to be based on review directions of the Committee of Commissioners and as per their authorization. In the present case, there is no such Committee or review/authorization. In 2009 by moving miscellaneous application, the Revenue wanted to regularize the original appeal filed by the Commissioner as if authorized by the Committee of Commissioners which took decision on 12.02.2009 only. We find that the misc. application filed by the Revenue has not been categorically allowed by this Tribunal. In fact, it was disposed of with an observation that such application is infructuous and does not call for any order. The reason being that at the time of consideration of an application for condonation of delay filed by the Revenue, no objection was taken on this aspect by the respondent. As rightly pointed out by the ld. Counsel for the respondent, we find that whether the appeal itself maintainable or not is a legal question which can be raised at any stage of proceedings. Reference can be made to the decision of the Honble High Court of Himachal Pradesh in the case of CCE Vs. Bhillai Wires Ltd. reported in 2009 (236) ELT 40 (HP). We find that in the present case, the appeal has not been filed in terms of the amended provisions of Section 35 F and Section 35 E. The impugned order has not been reviewed for a decision to file an appeal by the Committee of Commissioners as per the provisions applicable during the time. As such, we find considerable force in the arguments of the respondents against the maintainability of the present appeal.
9. On the merits of the case, we find that though in the appeal the Revenue states that the Commissioner (Appeals) erred in not giving importance to the statements recorded by the department to establish clandestine removal, we find that the statements recorded from the transporters are dealing with non-transport of the goods for job worker and have no relevance to establish the clandestine removal of the finished goods. In any case, these statements were not put to cross examination as requested by the respondent and no reason for the same has been recorded by the original authority. We find from the beginning that the respondent had been pleading regarding incorrect reconciliation of records resulting in shortage of finished goods. In the appeal, the Revenue states that the only plausible explanation for the shortage of finished goods is clandestine removal of such goods. We find such summary assessments and conclusions cannot be sustained in absence of any corroborative evidence regarding purchase of raw materials, production and transportation of such finished goods. We find no reason to interfere with the order of the ld. Commissioner (Appeals) on merits.
10. Considering the above discussion and findings, we hold that the appeal filed by the Revenue is liable for rejection, both on merit and on maintainability. Accordingly, we dismiss the same.
[Operative portion of the order pronounced in the open court] ( Sulekha Beevi C.S.) Member (Judicial) ( B. Ravichandran ) Member (Technical) ckp.
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