Custom, Excise & Service Tax Tribunal
M/S. Dalal Auto Engg. Industries vs Cce, Delhi-Iv, Faridabad on 30 July, 2012
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL,
WEST BLOCK NO.II, R.K. PURAM,
NEW DELHI-110066
COURT NO. II
Central Excise Appeal No. 413/2011-SM
[Arising out of Order-in-Appeal No. 239/Ce/Appl/DLH-IV/2010 dated 29.11.2010 passed by the Commissioner, Central Excise (Appeals), Delhi-IV, Faridabad]
Date of Hearing/decision: 30th July, 2012
M/s. Dalal Auto Engg. Industries Appellant
Vs.
CCE, Delhi-IV, Faridabad Respondent
Present for the Appellant : None Present for the Respondent : Shri Bharat Bhusan, Advocate Coram: Honble Shri D.N. Panda, Judicial Member;
FINAL ORDER NO. ________________ Per D.N. Panda:
Opportunity was granted to the appellant to produce input quantity used in job work goods and in the own manufactured goods on the last date of hearing i.e. 24.7.2012. It was also directed that the manner of generation of scrap and quantum thereof in respect of both activities is to be explained to find out whether there is any discrepancy with the balance sheet figure. None present today to explain the requirement of hearing. Nor there is any application for adjournment.
2. Assistance of learned D.R. is taken to find out whether adjudication was done judiciously on the quantum of scrap generation. Learned D.R. says that proper orders were passed by the authorities below.
3. Heard Revenue and perused the adjudication findings as well as first appellate findings.
4. There was excise duty demand of Rs. 4,44,995/- on the ground that during the course of audit, examination of record revealed that for the years 2005-06 to 2007-08 there was unreasonable generation of scrap which appeared in form 3 CD of audit report of the appellant under Section 44AB of Income Tax Act, 1961. If the audit report is considered to be correct then the appellant has to explain as to why such unreasonable generation of scrap appeared in the books of accounts as against 7% allowance to scrap generation (5% Burning loss and 2% recoverable scrap) was acceptable to department following method of manufacture carried out by the appellant.
5. Learned Appellate Authority did not find any plausible answer from the appellant. He concurred with the adjudication finding.
6. In the grounds of appeal, no doubt, the appellant has taken ground about the disclosure of figure as above under Income Tax Act, 1961. There is no convincing ground appearing, how the figures appearing in the income tax audit report has no basis for adjudication. Such circumstances are enough to uphold adjudication. Duty and interest element are confirmed as above. Adjudication order itself has imposed the penalty of Rs. 1,11,249/- which is equivalent to 25% of the duty element directing the appellant to deposit the same within 30 days of receipt of the order. Such an order does not call for interference. However, the appellant is directed to deposit the ordered amount of penalty of Rs. 1,11,249/- within 30 days of receipt of this order.
7. At this juncture, learned D.R. says that granting 30 days time shall go against the judgement of Honble Delhi High Court in the case of K.P. Pounches (P) Ltd. vs. UOI 2008 (238) ELT 0031 (Del.). It may be clarified that the dispute of facts comes to an end today. Once the lis ends today the result of order ending the litigation shall operate and orders of both the authorities merged in the order of the Tribunal. Therefore, it would not be improper to grant opportunity of 30 days time from the date of receipt of this order to discharge the concessional penalty if the appellant chooses to exercise such option. Failure to do so shall render the appellant to be liable to entire penalty. Interest on duty demand to follow.
(Dictated & pronounced in the Open Court.) (D.N. PANDA) JUDICIAL MEMBER RK 3 E/413/2011-SM