Customs, Excise and Gold Tribunal - Bangalore
Andhra Cements Ltd. vs Cce on 21 June, 2005
Equivalent citations: 2005(191)ELT1046(TRI-BANG)
ORDER T.K. Jayaraman, Member (T)
1. These appeals are against OIO No. 29/03 dated 3rd June 03 passed by the Commissioner of Customs and Central Excise, Guntur.
2. The charge against the appellants is that they had suppressed the production of cement during the period from 1.11.94 to 30.1.96. The allegation of suppression of production of cement and clinker is based on the discrepancies between the figures entered in RG I Register viz-a-viz the log books of the cement mill and clinker mill. In the impugned order, the adjudicating authority has confirmed the duty demand of Rs 2,17,89,099 under Section 11 A of Central Excise Act 1944. The imposed equal penalty under Rule 173 Q(1) and 226 of the erstwhile Central Excise Rules 1944. He ordered confiscation of land, buildings plant and machinery under Rule 173 Q (2) of the Central Excise Rules 1944 and gave an option to redeem the items on payment of fine of Rs 4,35,78,000/- only. He has imposed personal penalties on the following persons under Rule 209 A of the wrest while Central Excise Rules
1) NPS Shinh Managing Director --- Rs 2,00,00,000/-
2) S.V.S. Shetty, Vice President --- Rs 1,00,00,000/-
3) M.P. Singh, Deputy Manager --- Rs 1,00,00,000/-
3. Shri M. Chandrashekar learned Senior Advocate and Shri V.J. Sankaran learned advocate appeared on behalf of the appellants and Shri L. Narasimha Murthy, learned SDR for the Revenue.
4. The learned advocate urged that the adjudicating authority has come to the conclusion that there has been clandestine production and removal purely on the basis of RG I entries and the log book entries. There is no other evidence. There is nothing to corroborate the allegation of suppression of production of cement and clinker and their clearance. Further the learned advocates pointed out that during the relevant period, the machineries were not operating on full capacities.
5. We have gone through the records of the case carefully. We find that the department noticed discrepancies between the log book figures and RG I figures. No doubt, a suspicion arises that production of cement and clinker has been suppressed. Merely on this basis action cannot be taken against the appellant. The departmental officers failed to investigate the case thoroughly to establish clandestine production and clearance. If excess cement has been produced, the department should show excess power consumption. If goods had been cleared clandestinely at least investigations should have revealed a few instances of the buyers who have purchased clandestinely produced goods. It is very difficult to uphold the impugned order in the absence of corroborative evidences. In the case of Shingar Lamps Pvt Ltd.v.CCE Chandigarh (2002 (150) ELT 290 (Tri-Del) it has been held that mere difference in quantity of product between RG I and any private record is not enough to arrive at a finding of clandestine production. Under these circumstances we have no other option but to give the benefit of doubt to the appellants In the absence of any evidence of excess consumption of raw materials or of electricity to support the allegation. Following the ratio of the above decision we allow the appeals with consequential relief.