Customs, Excise and Gold Tribunal - Delhi
Collector Of Central Excise vs Ambica Silk Mills on 26 July, 1995
Equivalent citations: 1995(79)ELT460(TRI-DEL)
ORDER S.L. Peeran, Member (J)
1. The Revenue is aggrieved with the impugned order passed by the Collector (Appeals), Bombay. The Collector (Appeals) has disposed of two appeals by his common order. The Collector (Appeals) has accepted the appeal of the assessee seeking refund of duty of Rs. 982.44 and Rs. 1677.11. The department had also raised a demand for duty of Rs. 2645.40 which had been confirmed by the Assistant Collector. The ld. Collector has set aside this claim. Therefore, the Revenue is aggrieved on both the grounds and filed these appeals. There are two orders in original, one order-in-orginial dated 19-3-1983 dealing with the refund claim of the appellant and the other order-in-original dated 30-3-1983 deals with the show cause notice issued by the Deptt. and demand of duty of Rs. 15,027.22 for the clearances of goods made during the period indicated in the said show cause notices.
2. The facts arising in the order-in-original dated 19th March, 1983 pertaining to refund claim are as follows :
The assessee had been licensed to manufacture 'Man-Made Fabric' falling under T.I. 22(i) of the First Schedule attached to Central Excises & Salt Act, 1944 while finalising the R.T. 12 returns for the months of Nov. and Dec. 1980. The Supdt. Central Excise having jurisdiction over the factory observed that though the assessee had cleared man-made fabrics after cutting fents they had availed of the concession in the rate of duty in terms of the provisions (II) of the Notification No. 179/72, dated 24-7-1972 available to the lump clearances. The said Supdt. of Central Excise therefore pointed out short levy of Rs. 982.44 and Rs. 1677.11 for the months of Nov. & Dec. 1980 respectively. Accordingly the assessee paid the amount of short levy by debiting to their P.L.A. at Entry Nos. 146 & 147 respectively. Subsequently by their letters both dated 13-10-1981, the assessee came up with the request to refund the amount of short levy paid by them on the grounds that they had fulfilled the conditions as laid down in the Notification No. 179/72, dated 24-7-1972. Therefore, on rescrutiny of the claim papers found from the invoices, it was clearly indicated that they had cleared man-made fabrics in the fents also. It was also observed that the assessee had cut the fabrics before removal. As such it was observed by the department that they were not entitled for 5% reduction in the rate of duty in terms of Notification No. 179/72, dated 24-7-1972 as amended. Therefore, the assessee were called upon to produce the relevant documents in support of their claim that the fabrics cleared by them were not cut into fents. The ld. Collector after granting full opportunity of hearing held that the assessee had admitted that defective fabrics have been shown as fents in their invoices. He has also held that the assessee had not produced any documentary evidence to show that the fabrics were not cleared after cutting into fents. He has observed that though the assessee had been showing in the gate passes lump packing the invoices are made showing therein separately the goods quantity and fent quantity. Therefore, he has held that it is evident that the assessee had cleared the fabric after cutting only. Therefore, in that event of the matter, he has held that the department had rightly directed them to pay short levy and hence the question of granting refund in respect of the said amounts did not arise.
3. Another order-in-original dated 30-3-1983 pertains to the demand raised in the show cause notice. The ld. Asstt. Collector has after granting them due opportunity of hearing, observed from the text of the proviso (ii) of the Notification No. 179/72, dated 24th July 1972, it is seen that the duty payable on consignment of man-made fabric is reducible by 5%, if such fabric cleared from the processing factory without cutting any fents, rags, chindies or any portion of fabrics whether damaged or not. The ld. Asstt. Collector has held that on perusal of some of the invoices prepared by the assessee for processing charges, it was observed that they have indicated therein a quantity of fents separately that have not charged any processing charges for the quantity. Therefore, he has held that the consignment cleared by the assessee has not been cleared as lump packing but after cutting fents from the fabrics. Therefore, he has held that the demands made in the two show cause notices were recoverable to the extent of Rs. 1112.71 and Rs. 1532.69 for the period from 27-3-1981 to 31-3-1981 and that the assessee shall pay aggregate amount of Rs. 2645.40. However, he has set aside the three show cause notices and one show-cause notice dated 26-9-1991 for Rs. 3292/- has been partly set aside.
4. The ld. Collector (Appeals) in his order has accepted the plea of the assessee and has held that from the records, it is seen that there is no observation regarding cutting of fents in folding department or packing department. Therefore, he has set aside the demands against them and allowed their refund claim as well. The revenue in these appeals have submitted that the concession of 5% of duty under Notification No. 179/72, dated 24-7-1972 is available only if man-made fabrics were cleared in lump i.e. without cutting. In the instant case, the Respondents had cleared man-made fabrics after cutting, which is clear from the invoice issued by them for the fabrics cleared. Thus, the fabric was cleared in cut condition i.e. not in lump by the assessee and hence they are not entitled for the benefit of the said notification. The Revenue has not challenged that portion of the order-in-original by which the demands in three show cause notices have been dropped and partly dropped in another show cause notice. The respondents have not appeared for hearing despite several notices issued to them.
5. We have heard Shri Mohan Lal, ld. JDR in this matter.
6. We have carefully considered the submissions and have gone through the records. The ld. Collector has not given any findings in the impugned order, while the Asstt. Collector has given a detailed findings in his order. As regards the refund claim filed by the assessee, it has to be observed that the duty was debited to the P.L.A. at Entry No. 146 and 147 respectively as against the short levy for the period Nov. & Dec. 1980. The refund claim has been filed by their letter dated 13-10-1983. It is seen that the refund claim has been filed after six months of debiting the duty to their P.L.A. account. Thus, the refund claim would be barred by time. In any case, the ld. Asstt. Collector has rightly observed, that the evidence from the gate passes and invoices clearly indicated that the assessee had cleared the fabric after cutting only. Therefore, the ld. Asstt. Collector has rightly rejected the refund claim in terms of the said notification. The ld. Asstt. Collector has also rightly confirmed the demand in respect of two show cause notices. He has passed his findings on the evidence on record i.e. on perusal of the invoices prepared by the assessee for processing charges for the said quantity. Therefore, the findings of the Asstt. Collector that the consignment cleared by the assessee is not cleared as a lump packing from the fabrics is a correct finding. The same is not challenged by any evidence by the assessee before the lower authorities. They have not produced any evidence in support of their case even at this stage. Therefore, the ld. Collector was not justified in setting aside the impugned orders. Orders passed by the Asstt. Collector are sustainable orders and they are required to be confirmed by setting aside the impugned order of the Collector (Appeals). Thus the appeals are allowed.