Customs, Excise and Gold Tribunal - Bangalore
Reliance Cellulose Products Ltd. vs Commissioner Of Central Excise on 13 April, 2004
Equivalent citations: 2004(95)ECC649
ORDER K.C. Mamgain, Member (T)
1. This appeal is filed by the appellants, Reliance Cellulose Products Ltd. against the Order-in-Appeal No. 109/2001 (H-I) CE dated 7.6.2001 passed by the Commissioner of Customs and Central Excise (Appeals), Hyderabad.
2. The appellants were manufactures of several products falling under Tariff Hem Nos. 68, 15A and 14C of the Central Excise Tariff in force during the relevant period. The allegation against them .is that they removed dutiable excisable goods without payment of Central Excise duty and without the cover of proper Central Excise documents, Show cause notice issued to them was adjudicated by the then Collector of Central Excise, Hyderabad vide Adjudication Order No. 7/85 dated 19.3.85, confirming certain demands as alleged in the show cause notice. He also imposed penalty of Rs. 2 lakhs on the appellants. On appeal, the Tribunal under Order No. 1349/96A dated 2.4.96 remanded the case back to the lower authority for consideration the following-
whether mother liquor was sold before or after 1983,
(ii) To look into the valuation aspect of HCL; and
(iii) To take a fresh view with regard to the quantum of penally also.
3. After remand, the above three issues were adjudicated by the Joint Commissioner under Order-in-Original No. 40/99 dated 17.9.99. On appeal against this order, the Commissioner (Appeals) under the impugned order has found that the Mother liquor was being sold before and after 1983. Me also come to the conclusion that the price of HCL is Rs. 450 per M.T. for demanding duty, and he reduced the penalty to Rs. 1,00,000.
4. Shri.V.J. Sankaram, Ld. Advocate on behalf of the appellants pleaded that the Mother Liquor was not marketable and the appellants never sold such Mother Liquor at any time. The consignee, namely Sridevi Chemicals Pvt. Ltd. to whom consignment was sold under invoice No. CP/ML/1/82-83 elated 12.9.83, had declined to recognize the said waste as goods and it also held that it never "purchased" the said Mother Liquor. The Mother Liquor was not marketable and there was no sale. The ISI Standard is provided for production of Mono Chloro Acetic Acid and sold in the form of white crystals and trade does not accept the said Mother Liquor as MCA. Merely the fact that the Mother Liquor might fetch a price, it would not warrant classification of Mother Liquor as MCA. The value of HCL was dependent on the strength of the acid. That Rs. 150 per M.T. was the approved price latter and at that point of time no goods were sold to Auxiliary Chemicals and Jai Chemicals. Therefore, demanding duty on a value of Rs. 150 per M.T. is improper.
5. Shri B.R. Jagadish, Ld. JDR for Revenue has stated that the matter was remanded by the Tribunal to consider the three points and all these three points have been properly examined by the lower authorities and the Commissioner (Appeals) has given clear findings on each of these issues and he also reduced the penalty from Rs. 2. lakhs to Rs. 1 lakh. He said that there is clear evidence of sale of 70.5 MT of Mother, liquor by the appellants to Sridevi Chemicals Pvt. Ltd. in 1983 and there are evidence of sale of Mother Liquor by other parties from 1981 to 1984 as given in the order of the Commissioner (Appeals). Therefore, the Mother Liquor has been upheld as marketable. Regarding HCL, he staled that as given in the findings, investigations were conducted and on investigation, only value of Rs. 450 per MT at the material time was determined. Therefore, there is no infirmity in the order of the Commissioner (Appeals) and the appeal has to be rejected.
5. We have carefully considered the submissions made by both the sides. We find that the appellants have sold 70.5 MT of Mother liquor (80% MCA) under the invoice No. RCP/ML/1/82-83 dated 12.9.83 issued by the appellants to Sridevi Chemicals Pvt. Ltd. from time to time at Rs. 5,64,000. The Commissioner (Appeals) also found that --
"the Hon'ble CROAT vide I heir order referred to above, have observed that Kalpana Chemicals Pvt. Ltd., uiuier their reference dated 29.2.84 had intimated to the Central Excise Department that the appellant's Company had sold the product Mother liquor to them under their Gate Pass No. 602 dated 15.7.81. They had also handed over copies of the various invoices by Ashok Organics Industries Ltd., Baroda who had sold the product described as Waste MCA to them at a price and after payment of 10% Central Excise duty and 4% CST. From the above, it is clear that Waste MCA/Mother liquor was a marketable commodity even during the period prior to 1983, being bought and sold in the market and fetching price."
We also find that the prices of the HCL were fixed after making enquiries. The Commissioner (Appeals) in his order has observed that --
"the Assistant Commissioner, vide his letter dated 23.4.86, finalized the Price List dated 20.3.85, whereas in the instant case, we are concerned with the clearances of the HCL for the much earlier period. The detailed investigations conducted against the appellants in this regard as indicated in the impugned order, revealed that the appellants realized Rs. 450 per MT for the HCL sold by them at the material time. In such a situation, the adoption of Rs. 450 per MT as the value for demanding duty on the HCL during the relevant period is legal and proper."
The appellants have not produced any contrary evidence before us. Therefore, we do not find any infirmity in the order of the Commissioner (Appeals). We also find that the Commissioner (Appeals) has reduced that penalty amount from Rs. 2,00,000 to Rs. 1,00,000.
6. We do not find any merit in the appeal and the same is rejected.