Custom, Excise & Service Tax Tribunal
C.C.E., Ludhiana vs M/S. Nexo Products (India) on 21 February, 2014
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
WEST BLOCK NO.2, R.K. PURAM, NEW DELHI 110 066
Date of Hearing 11.02.2014
Date of Decision 21.02.2014
For Approval &Signature :
Honble Mrs. Archana Wadhwa, Member (Judicial)
1.
Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
No
2.
Whether it would be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
No
3.
Whether Lordships wish to see the fair copy of the order?
Seen
4.
Whether order is to be circulated to the Department Authorities?
Yes
Appeal No. E/3202/2007 -EX[SM]
[Arising out of Order-in-Appeal No.235/CE/LDH/2007, dated 24.08.2007 passed by the C.C.E.(Appeals), Jalandhar (HQs. At Chandigarh)]
C.C.E., Ludhiana Appellants
Vs.
M/s. Nexo Products (India) Respondents
Appearance Shri BB Sharma, DR - for the appellants None - for the respondent CORAM: Honble Mrs. Archana Wadhwa, Member (Judicial) Final Order No.50819/2014, dated 21.02.2014 Per Honble Mrs. Archana Wadhwa :
Being aggrieved with the order passed by the Commissioner (Appeals), Revenue has filed the present appeal. Shri RK Mishra, Ld. Departmental Representative appeared for Revenue and nobody appeared for the respondents.
2. As per facts on record, the respondents are engaged in the manufacture of fastners, i.e., nuts and bolts, washers, rivets, etc. falling under Chapter 73 of the First Schedule to the Central Excise Tariff Atc, 1985. Their factory was visited by the Central Excise officers on 19th/20th December, 2005, who conducted various checks and verifications. The visiting officers detected shortage of various types of nuts, bolts and washers totally valued at Rs.90,45,240/- (Rupees ninety thousand forty five thousand two hundred and forty only) involving duty of Rs.14,76,183/- (Rupees fourteen lakh seventy six thousand one hundred and eighty three only). Shri Amrik Singh, proprietor of the respondent company, admitted the said shortages and deposed that the goods have been cleared against cash on as it is where it is basis. The duty involved was also debited through PLA.
3. On the above basis, proceedings were initiated against the respondents for confirmation of demand of duty and imposition of penalty. The respondents submitted before the adjudicating authority that the shortage report was not correct in as much they are maintaining only one RGI register for all accounts of nuts and bolts and no separate records are being maintained as per size of nuts, bolts and washers. As such, physical verification report showing shortages in various types of nuts and bolts does not reflect the correct position. They also submitted that they are exporting the entire production and it was not possible for them to sell such a huge quantity of goods in Indian market. The products being manufactured by them are hot dip galvanised nuts and bolts, which are normally consumed by the industrial consumers and cannot be sold in the open market. The proprietor was coerced in giving a statement at the time of picking of the offence which stands retracted.
4. However, the above pleas did not find favour with the adjudicating authority, who confirmed the demand and imposed penalty.
5. On appeal, Commissioner (Appeals) set aside the impugned order of the original adjudicating authority on the ground that the verification report is not correct in as much as the same relates to various varieties of nuts and bolts manufactured by the respondents, whereas, they were maintaining single consolidated RGI register without recording the production on variety-wise basis. He also observed that there is no corroboration from any other independent source and mere shortages detected by the officers, which are also doubtful, the findings of clandestine removal cannot be upheld. For the above purpose, he referred to and relied upon various decisions of the Tribunal.
Hence, the present appeal by the Revenue.
6. After going through the impugned order, I find that the Revenues entire case is based upon the allegedly detected shortages by the visiting officers read with the statement of the proprietor. The assessee is manufacturing different varieties of nuts and bolts and is maintaining only one consolidated RGI register in respect of all the varieties. As such, it is not only difficult, but impossible for the visiting officers to detect the shortages on variety-wise basis. It is not explained as to how the alleged shortages were detected by the officers, without even preparing any inventories. Apart from the said shortages, there is virtually no other evidence to show the clandestine manufacture and removal of the goods by the respondents. The Revenues reliance on the statement of Shri Amrik Singh, given before the visiting officers accepting the shortages and clandestine removal, cannot be pressed into services, in the absence of any independent corroborative evidence. Further, the contention of the respondents is that their production is mainly exported and the indigenous clearances are only to the industrial units is to be accepted in the absence of any contrary evidence to that effect. If that be so, the statement of the proprietor, deposing that the goods were sold in the open market to independent buyers cannot be held to be correct reflection.
7. In view of the above, I find no infirmity in the impugned order of the Commissioner (Appeals). Accordingly, the appeal filed by the Revenue is rejected.
Pronounced on 21.02.2014 (Archana Wadhwa) Member (Judicial) SSK -2-