Custom, Excise & Service Tax Tribunal
H & R Johnson (India) Ltd vs Commissioner Of Central Excise on 21 March, 2014
IN THE CUSTOMS, EXCISE AND SERVICE TAX
APPELLATE TRIBUNAL, NEW DELHI
PRINCIPAL BENCH, COURT NO. III
Excise Appeal No. 2693 & 2694 of 2009- [SM]
[Arising out of Order-In-Appeal No. IND-I/209 & 210/2008 dated 8.12.2008 passed by Commissioner (Appeals) Customs & Central Excise, Indore ]
For approval and signature:
Honble Ms. Archana Wadhwa, Member (Judicial)
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Whether Press Reporters may be allowed to see 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?
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Whether Their Lordships wish to see the fair copy of the Order?
Seen
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Whether Order is to be circulated to the Departmental authorities?
Yes
H & R Johnson (India) Ltd. Appellants
Vs.
Commissioner of Central Excise Respondent,
Indore Appearance:
Ms Asmita Nair, Advocate for the Appellants Shri B B Sharma, AR for the Respondent Date of Hearing /decision: 21.03.2014 ORDER NO. FO/ A 51176-51177 /2014- Ex(SM) Per Archana Wadhwa:
Both the appeals are being disposed of by a common order as they arise out of same set of facts and circumstances.
2. After hearing both sides, I find that appellants are engaged in the manufacture of glazed and unglazed tiles of various varieties. Their factory was visited by Central Excise officers on 20.11.97, who conducted various checks and verifications. As a result of stock taking, the shortages and excesses were found in different varieties of goods which were recorded in a panchnama drawn on the spot. Statement of representative of appellants company accepted such shortages and excesses.
3. Thereafter the appellants placed on record the reconciliation statements, showing breaking of some variety of tiles and recording of the same in statutory records. During adjudication, such reconciliations statements were accepted and the demands were brought down. The matter had traveled up to Tribunal two times when the same was remanded to the lower authorities for reconsideration of excesses and shortages.
4. The impugned orders stand passed in denovo proceedings
5. After appreciating the submissions made by both the sides and after going through the impugned orders, I find that the entire case of the Revenue for arriving at the finding of the clandestine removal is based upon the shortages conducted at the time of visit of the officers. Similarly, excess found goods stand confiscated along with imposition of penalty on the sole ground that the same were not entered in the statuary records.
6. It is seen that appellants are manufacturing different varieties of tiles and shortages and excesses were found only in one variety. Apart from the said shortages, and the statement of representative admitting such shortages, there is no other evidence of record to show that such alleged shortages were cleared by the appellant in a clandestine manner. It is well settled law that shortages by itself cannot be held to be sufficient evidence to conclude the clandestine activities of an assessee. In the absence of any evidence, I find no justification for confirmation of demand or for imposition of penalty on the appellant, on the finding of clandestine removal. As regards excesses, it stand explained that goods in question were not upto the mark and they had applied for destruction of the same. In any case, I find that it is not the Revenues case that excess found impugned goods are meant for clandestine removal or they are in ready to move condition. As such, I find no justification for confiscation of the same or for imposition of penalties.
7. The second appeal in fact relate to the refund of duty deposited immediately by the appellant after detection of the shortages. Inasmuch as the first appeal is being allowed, the deposits made by the appellant are liable to be refunded to them. Accordingly, second appeal of the appellant is also allowed.
8 In view of the above, I allow both the appeals with consequential relief to the appellants.
(pronounced in the open court)
( Archana Wadhwa ) Member(Judicial)
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