Custom, Excise & Service Tax Tribunal
Commissioner Of Central Excise vs M/S. Spp Polypack Pvt. Ltd on 27 April, 2012
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, BANGALORE SOUTH ZONAL BENCH COURT - I Appeal No: E/1009/2010 (Arising out of Order-in-Appeal No:22/2010 (H-IV) CE dated 25.2.2010 passed by the Commissioner of Customs & Central Excise (Appeals-II), Hyderabad..) 1. Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No 2. Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? Yes 3. Whether their Lordship wish to see the fair copy of the Order? Seen 4. Whether Order is to be circulated to the Departmental authorities? Yes Commissioner of Central Excise Hyderabad-IV Commissionerate Hyderabad. Appellant Versus M/s. SPP Polypack Pvt. Ltd. Respondent
Appearance Ms. Sabrina Cano, Superintendent (AR) for the Revenue.
Shri B. Venugopal, Advocate for the respondent.
CORAM SHRI P. G. CHACKO, HONBLE MEMBER (JUDICIAL) Date of Hearing: 27.04.2012 Date of decision: 27.04.2012 FINAL ORDER Nos._______________________2012 The appeal filed by the department is against the appellate Commissioners order setting aside the original authoritys order demanding a certain amount of duty by way of denial of CENVAT credit, imposing penalties etc.
2. On a perusal of the records and hearing both sides, I note that the relevant show-cause notice was issued on the basis of discrepancies allegedly found in RG23A Part-I Register of the respondent for the period 2006-07. The show-cause notice alleged that CENVAT credit amounting to Rs.2,86,546/- (basis excise duty plus education cess) had been taken by the respondent on a quantity of 23,883 kgs of raw materials during the above period without utilizing these raw materials actually in the manufacture of final product. This allegation was contested by the party. Before the adjudicating authority, the respondent pleaded that the discrepancy in RG23A Part-I register was on account of clerical errors only and that there was no instance of any amount of CENVAT credit having been taken without utilization of raw materials in the process of manufacture of final products. However, it appears, the respondent could not substantiate this claim before the adjudicating authority. They did not produce the profit and loss account and balance sheet for the relevant period, even though they relied on these documents in support of their plea of clerical error. The result was that the demand of duty came to be confirmed against the respondent and equal amount of penalty imposed on them. In an appeal filed with the Commissioner (Appeals) against the order-in-original, the party once again relied on the profit and loss account and the balance sheet and contended that the discrepancy in the RG23A Part-I register was on account of clerical error. In support of this contention, the respondent furnished copies of audit report (submitted under Section 44AB of the Income Tax Act, 1962) and the monthly stock statements submitted to UTI bank, and the appellate authority examined these documents and found merit in their contention that discrepancy in the raw materials account was due to clerical error. The appellate authority found fault with the order-in-original on other counts also. In the result, the assessees appeal came to be allowed. Hence the present appeal of the department.
3. In this appeal it is the argument of the appellant that the contention of the assessee that the profit and loss account was faulty due to clerical error was an attempt to get away. It is submitted that the assessee in their statement under Section 14 of the Central Excise Act admitted that the registers were not properly maintained. The appellant relies on judgments also. The point sought to be made is that the CENVAT credit in question is recoverable from the assessee (respondent) as they did not maintain their raw material account properly.
4. Heard both sides. The learned Superintendent (AR) reiterates the grounds of the appeal and the learned counsel for the respondent reiterates the findings of the appellate Commissioner.
5. It is not in dispute that clerical errors were made by the respondent. The records prepared and maintained under the Income Tax Act are claimed to be in order and the respondent seeks to rely on these records to substantiate their contention that the discrepancy in the raw material account is a mismatch with the income tax account and that the discrepancy arose out of clerical error. It is not in dispute that the income tax records were not produced before the original authority. These records were produced before the appellate authority and were examined by that authority. The findings recorded by the appellate authority are presently under challenge by the department. If that be the case, let the adjudicating authority conduct a careful scrutiny of all the relevant records and pass de novo adjudication order, for the ends of justice. On this basis, I set aside the orders of both the authorities and allow this appeal by way of remand with a direction to the original authority to take fresh decision on the substantive issue after giving the party a reasonable opportunity of adducing further evidence, if any, and giving them a reasonable opportunity of being heard.
(Pronounced and dictated in open Court) (P. G. CHACKO) Member (J) rv ??
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