Custom, Excise & Service Tax Tribunal
Cce, Chennai vs Composite Boards (P) Ltd on 16 July, 2009
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
SOUTH ZONAL BENCH AT CHENNAI
E/281/2007 and E/CO/33/2007
(Arising out of Order-in-Appeal No. 33/2007 (M-II) dated 22.2.2007 passed by the Commissioner of Central Excise (Appeals), Chennai)
For approval and signature:
Honble Smt. Jyoti Balasundaram, Vice-President
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 the Member wishes to see the fair copy of the Order?
4. Whether Order is to be circulated to the Departmental authorities?
CCE, Chennai Appellant
Vs.
Composite Boards (P) Ltd. Respondents
Appearance Ms. Indira Sisupal, JDR for the Appellant Shri P.R. Venkataraman, Consultant for the Respondents CORAM Honble Smt. Jyoti Balasundaram, Vice-President Date of Hearing: 16.07.2009 Date of Decision: 16.07.2009 Final Order No. ____________ The brief facts of the case are that the assessees herein are registered manufacturers of plywood and compreg boards. During the visit of the officers of the Divisional Preventive Unit to the factory of the assessees on 16.11.2004, and on verification of the records, registers and balance sheets, it was found that the value of clearances shown in the balance sheet etc. did not tally with those mentioned in the Central Excise returns submitted by the assessee to the Department. It has been, therefore, alleged that the assessees had manufactured and cleared goods clandestinely without accountal and without payment of duty during the financial year 2002 03. Show Cause Notice proposing recovery of duty invoking the extended period of limitation on the ground of suppression on the part of the assessees and proposing imposition of penalty was issued; the explanation of the assessees that the difference between the figures shown in the balance sheet and the lesser figure shown in the Central Excise returns was due to (a) rounding of figures based on number of pieces of boards manufactured and (b) inclusion of value corresponding to trading activity was rejected by the adjudicating authority who confirmed a demand of Rs.41,300/- under proviso to Section 11A of the Central Excise Act, 1944 together with appropriate interest and imposed equal amount of penalty under Section 11AC of the Act and a penalty of Rs.1,000/- under Rule 25 of the Central Excise Rules, 2002. The Commissioner (Appeals) accepted the explanation of the assessees and set aside the demand; hence this appeal of the Revenue.
2. I have heard both sides. The value of clearances shown in the balance sheet is a little over Rs.67 lakhs while the value of clearances shown in the Central Excise returns was little over Rs.56 lakhs, the difference therefore is about Rs. 11 lakhs. This certainly cannot be attributed to rounding of figures. As regards the plea that the value of trading activity was also included in the figure shown in the value of clearances reflected in the balance sheet, I reject this argument as not tenable for the reason that the assessee being manufacturer was required to be registered for carrying trading activity for which he was not able to produce any proof of registration. Secondly the balance sheet does not show any value of trading activity separately and the figure of little over Rs.67 lakhs represented value of clearances as a composite/consolidated figure and therefore the assessee has not been able to substantiate the plea that they were also carrying on a trading activity and had included the value of such activity in the total figure of little over Rs.67 lakhs in the balance sheet. I, therefore, hold that the charge of clandestine clearance has been made out by the Revenue and accordingly I set aside the impugned order, restore the order of the adjudicating authority and allow the appeal.
3. The cross-objection which is in the nature of reply to/ comments on the Revenues appeal is dismissed.
(Dictated and pronounced in open court) (JYOTI BALASUNDARAM) Vice-President Rex ??
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