Custom, Excise & Service Tax Tribunal
Commissioner Of Central Excise, ... vs M/S. Mahesh Mathuradas Ahuja on 5 May, 2010
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH AT MUMBAI APPEAL NO. E/2387/06 E/CO-443/06 (Arising out of Order-in-Appeal No. BR/267/Th-I/06 dated 17/4/06 passed by the Commissioner (Appeals) Central Excise, Mumbai-IV For approval and signature: Honble Shri Ashok Jindal, Member (Judicial) ============================================================
1. Whether Press Reporters may be allowed to see : No
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 Their Lordships wish to see the fair copy : Yes
of the Order?
4. Whether Order is to be circulated to the Departmental : Yes
authorities?
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Commissioner of Central Excise, Thane-I
:
Appellants
VS
M/s. Mahesh Mathuradas Ahuja
Respondents
Appearance
Shri N.A. Sayyed, JDR Authorized Representative
None for Respondents
CORAM:
Shri Ashok Jindal, Member (Judicial)
Date of decision : 05/05/2010
ORDER NO.
Per : Ashok Jindal, Member (Judicial)
Revenue has filed this appeal against the impugned order wherein the penalty under Section 11AC and redemption fine has been dropped against the respondent.
2. The facts of the case are that the respondent are engaged in manufacture of grey man made fabrics and availing CENVAT Credit of the duty paid on man made yarn used in the manufacture of final product i.e. grey fabrics. The respondent also undertake the job work of weaving grey fabrics from yarn supplied by the customers giving such jobs. The factory of the respondent was visited and found that a shortage of 23,573.25 L Mtrs. They detained the whole stock of 95,454 Mtrs. and 28,475.940 Kgs of yarn lying in the stock. The statements were recorded wherein Shri Mahesh Ahuja, the Proprietor of the appellant firm admitted that his excise accountant was on leave and therefore, the consolidated daily stock account was not maintained upto date. The duty shown in invoices for the clearance of grey fabrics made in January, 2004, February 2004 and March 2004 were not debited in the CENVAT Account Registr-RG-23A. However, he stated that there was daily account of production of grey fabrics at loom stage. The difference in stock position was due to the practice of stretched measuring of fabrics at loom stage to show more length by the labourers who get remuneration with reference to the length of the fabrics woven by them. Although he admitted the difference/shortage of grey fabrics and paid duty on them. A show-cause notice was issued proposing to recovery of duty with interest on shortage of grey fabrics. A proposal for confiscation of detained goods was also made and same were confirmed during adjudication. The Commissioner (Appeal) confirmed the demand but drop the penalty and redemption fine on the respondent. Aggrieved from the same, revenue is before me.
3. Shri N. A. Sayyed JDR appearing on behalf of the revenue submitted that it is a case of shortage of finished goods and the respondent has not paid the duty in time as he has to discharge his duty liability by debiting in RG 23A register at the time of clearance of the goods, which amounts to suppression and penalty leviable on the respondent.
4. No one appeared on behalf of the respondent despite several notices for 23.12.2009, 24.2.2010, 31.3.2010 and 5.5.2010 i.e. today. Neither anybody appeared nor any representation was made by the respondent, although the respondent has filed their Cross-objections which are taken on record and considered.
5. Heard.
6. After hearing the learned DR and careful examining the records available before me. I find that in this case the allegation against the respondent is that they have suppressed the facts and not discharged their duty liability by debiting the duty part in their statutory records. There is no allegation against the respondent that there was a clandestine removal or removal of goods without payment of any Central Excise duty. It is admitted fact that the goods have been cleared on payment of Central Excise duty. Mere fact that the debit entries in their statutory records were not made by the respondent at the time of clearance does not amount suppression. Moreover, the respondent has explained why these amount were not entered in the statutory records. When there is no allegation of clandestine removal, no penalty can be imposed. The respondent has also explained the reasons for shortage of stock at the time of physical verification and there is not intention of the respondent to evade the duty. In the absence of any intention, penalties under Section 11AC cannot be imposed. Accordingly, I do not find any reason to interfere the impugned order same is upheld. Appeal filed by the Revenue is rejected. Cross-objections are also disposed of in the above manner.
(Pronounced in court) (Ashok Jindal) Member (Judicial) Sm 3