Customs, Excise and Gold Tribunal - Mumbai
Benzo Chem Industries Pvt. Ltd. And M.K. ... vs Commissioner Of Central Excise & ... on 7 March, 2003
ORDER Gowri Shankar, Member (T)
1. The applications are for waiver of deposit of penalty imposed on the applicant of Rs. 13,03,362/- on Benzo Chem Inds. P. Ltd. and Rs. 10,000 on M.K. Patel, its administrative officer. The duty demanded from the assessee of Rs. 13.03 lakhs has already been deposited.
2. The amount that was demanded from the assessee represented modvat credit that it took of the duty paid on the various quantities of inputs required for manufacture of orthochloro benzene, which it was alleged in the notice issued to it, had not been used by it in the manufacture of final product, but had been disposed of by sending it to another unit. Failure to follow Rule 57F in this regard was also held. The Commissioner confirmed the demand and imposed penalty. Disposing of the appeal against that order, the Tribunal noted that the data on which notice was issued had been retrieved from the assessee's possession and if this data was sufficient to conclude that the inputs had been sent to another unit the statements contained in it that intermediate products had been returned should not be ignored. It therefore remanded the mater to the Commissioner for considering these aspects.
3. In the order, the Commissioner has found that major quantities of the inputs which were sent out had in fact been utilised in the manufacture of intermediate product which were returned to the assessee although proper procedure under law was not followed. She then finds that this still leaves unexplained some quantity. Counsel for the applicant points out significant errors in the statement annexed to the Commissioner's order. He points out that on many occasions, quantities of inputs which were returned and had been used in the manufacture of final product have not been taken into account. Thus, for example, two quantities of 9960 kgs. of chlorine requirement in the manufacture of 10,790 kgs. of chloro orthochloro benzene had been omitted to be taken into account although the other two inputs have been taken into account. He has drawn out statements in which these were taken into account then duty payable would come to little excess of Rs. 1 lakh. Therefore, he contends the amount of duty that the assessee had to pay is significantly reduced.
4. The departmental representative, when confronts with the omission in the Commissioner (Appeals) is not able to produce any material to the contrary.
5. In our prima facie view therefore duty payable would come to a little of Rs. 1 lakh and since duty deposited in excess of this account almost includes the duty paid in excess only falls short of the penalty, we waive deposit of the penalty imposed on the assessee and its employee and stay its recovery.