Custom, Excise & Service Tax Tribunal
M/S Nippon Tubes Ltd vs Commr. Of Central Excise & S. Tax, ... on 14 November, 2017
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL,
REGIONAL BENCH : ALLAHABAD
MA (EH)-70308,70309/17
& Ex.Appeal Nos.70645,70646/17
Arising out of O/A No.GZB-EXCUS-000-APP-534-535-17-18 dated 20.06.2017 passed by Commr. (Appeals) of Central Excise, Customs, Meerut II.
M/s Nippon Tubes Ltd.
Shri Ganesh Kumar Aggarwal, Director
APPELLANT(S)
VERSUS
Commr. of Central Excise & S. Tax, Ghaziabad
RESPONDENT (S)
APPEARANCE Shri Rajesh Chibber, Advocate for the Appellant (s) Md. Altaf, Asstt. Commissioner (A.R.) for the Revenue CORAM:
MRS. ARCHANA WADHWA, HONBLE JUDICIAL MEMBER DATE OF HEARING/DATE OF DECISION : 14. 11. 2017 FINAL ORDER NO. 71412-71413/2017 Per Mrs.Archana Wadhwa :
After hearing both sides, I find that the appellant is engaged in the manufacture of pipes, tubes of various sizes, grades and thickness out of H.R.Coils. Their factory was visited by the Central Excise Officers on 17.12.13, who conducted various checks and verifications. As a result of stock taking, certain shortages were detected in the raw materials as also in the final product. The said shortages were taken note of by way of Panchanama . The Director of the Company also accepted such shortages.
2. On the above basis, proceedings were initiated against the appellants, by way of issuance of show-cause notice dt. 07.01.2015 raising demand of duty of Rs.9,72,721/- in respect of final product and Rs.5,34,618/- in respect of inputs on the allegation of the clandestine removal.
3. During Adjudication, the appellant contested the said findings by submitting that shortages detected by the officers, were pscudo and not real inasmuch as there were no inventory drawn by the Revenue for such shortages. It was also contended that apart from the shortages, there is virtually no other evidence on record to show any clandestine removal. Even the statement of the Director has admitted only shortages, but no clandestine removal of the goods.
4. The original adjudicating authority did not find favour with the above pleas and confirmed the demand, as proposed in the inotice along with confirmation of interest and imposition of penalty. The said order of the original adjudicating authority stands upheld by the Commissioner (Appeals) . Hence the present appeal.
5. After hearing both sides, I find that there is no dispute about the fact that the Revenues entire case for clandestine findings against the appellants, is based only upon the shortages detected at the time of their visit. The matter has not been further investigated by the Revenue and no evidences of such clandestine manufacture and clearance, stands produced by them on record. The Honble Allahabad High Court in the case of Commr. of Central Excise, Kanpur Vs. Minakshi Castings : 2011 (274) ELT 180 (All.) has upheld the Tribunals decision laying down that the shortages detected at the time of visit of the officer cannot by itself lead to the findings of clandestine removal. The said decision stands followed by the Tribunal in the cases of (i) Commr. of Central Excise, Meerut I Vs. Sarvottam Rolling Mills (P) Ltd. : 2013 (297) ELT 385 (Tri.-Del.) & (ii) Behariji Marketing : 2015 (317) ELT 298 (Tri.-Del.). At the stage, I may also take note of the decision of the Honble Punjab & Haryana High Courts decision in the case of Commr. of Central Excise & Service Tax, Ludhiana Vs. Anand Founders & Engineers : 2016 (331) ELT 340 ( P & H) laying down to the same effect that the shortages cannot lead to conclusion of clandestine activities unless further investigations are conducted to indentify the buyers or suppliers of the raw materials.
6. By following the above decisions, I find no merit in the Revenues stand. Accordingly, the impugned orders are set aside and both the appeals are allowed with consequential relief to the appellants.
7. Miscellaneous Applications also get disposed off.
Dictated and pronounced in the open Court (ARCHANA WADHWA) MEMBER (JUDICIAL) mm 8 Ex.Appeal Nos.70645,70646/17