Customs, Excise and Gold Tribunal - Mumbai
Cosmo Films Limited And Janardan Gupta vs Commissioner Of Central Excise & ... on 17 April, 2001
ORDER Gowri Shankar, Member (T)
1. The applications are for waiver of deposit of duty of Rs. 17.24 lakhs and penalty of equivalent amount imposed on the company, and penalty of Rs. 25,000/- under rule 209A on Janardan Gupta, its director. The manufacturer has factories at Chikalthana, Silvassa and Waluj. It manufactures in its factory at Chikalathana biaxially oriented polypropylene (BOPP) film, as well as adhesive tape. It sold some of the BOPP film to buyers at prices ranging from Rs. 120/- to 140/- per kilogram, and cleared the remainder to its factory at Silvasa for making laminated BOPP films there, at Rs. 80/- per kilogram. The appellant sent the entire quantity of adhesive tapes manufactured in this factory to its factory at Waluj to be used in packing of the BOPP films manufactured by it. It laid duty on these films under rule (b)(1) on the cost of the manufacture.
2. In October, 1997 the departmental officers visited the factory and discovered the difference between the values at which the manufacturer sold the BOPP film to its buyers and the value adopted for clearance to Silvassa. The officers also found that the cost of manufacture on which the applicant paid the duty on adhesive tape was outdated and required upward revision. As a result of departmental action that ensued, the manufacturer paid, between the date of visit of the officers until 31st December, 1997 the total of the duty short paid of Rs. 41.36 lakhs.
3. The department issued a notice on 29th November, 1999 proposing to adjust this duty of Rs. 40,76,729/- against that demanded in the notice for the reasons that we have narrated above the proposed penalty under Section 11AC on the manufacturer and under rule 209A on Janardan Gupta. In his order impugned in these appeals the Commissioner, in addition to adjusting the duty already paid, demanded, has confirmed a further sum of Rs. 17,24,373/-. He also imposed a penalty equal to this amount under Section 11AC on the company and Rs. 25,000/- on Janardan Gupta.
4. The contention of the representative of the applicants that the Commissioner could not confirm an amount of duty other than what was contained in the notice prima facie to be accepted. The Commissioner does not advance any clear reason in his order for the action that he has taken. Even if he had, it is settled law that no amount of duty in excess of that specified in the notice could be confirmed. Accordingly, we waive deposit of the duty and stay its recovery on this count.
5. The representative of the applicant contends that Section 11AC could not invoked because there was no intent to evade duty. Whatever was paid or payable was paid Chikalthana would be available as credit at Silvasa unit in the case of BOPP and at Waluj unit in the case of adhesive tapes. The same person owns all the three factories. There therefore would be no intention to evade duty, because whatever was paid in one factory would be available as credit in the other. he cites the decision of the Tribunal in BPL Sanyo Utilities & Appliances Vs. CCE 2000(90) ECR 678 holding this view.
6. While the departmental representative seeks to emphasise the suppression of facts, whatever the truth relating to that aspect, the decision of the Tribunal and others at this stage is in applicant's favour. Prima facie penalty not imposable.
7. We therefore waive deposit of the duty and penalties and stay their recovery.