Commr. of C. Ex. and Customs vs Hema Exports

K.A. Puj, J.—The Appellant revenue has filed this Tax Appeal u/s 35G of the Central Excise Act, 1944 proposing to formulate the following substantial questions of law for determination and consideration of this Court:

(i) Whether in the facts and the circumstances of the case, the Ld. Tribunal is justified in the eye of law in holding that the proceedings could not be extended beyond the shortages recorded in the Panchnama dtd. 28-9-2002 and the quantum could not be increased, ignoring and over-looking the fact that the Managing Partner of the said Unit had very much accepted and admitted the calculative error which was noticed only after the further investigation of the seized records of the said Unit by the Revenue, and corroborated by the evidence on record?

(ii) Whether in the facts and the circumstances of the case, the Ld. Tribunal is justified in the eye of law, in reducing the duty confirmed from Rs. 4,38,104/- to Rs. 3,56,023/-, by considering shortage quantity of 7735.000 Kgs. of the Polyester Texturised Yarn, recorded in the Panchnama, rather than the correct shortage quantity of 9521.700 Kgs. of the Polyester Texturised Yarn, which had been illicitly removed and sold in the open market, on cash-payment by the said Unit?

(iii) Whether in the facts and the circumstances of the case, the Ld. Tribunal is justified in the eye of law in granting the option to the Assessee to deposit the entire dues alongwith 25% interest of Penalty, within the period of thirty days of the communication of the Order-in-Appeal dated 17-3-2009, in which case the Penalty shall stand restricted to 25% of the duty-amount, in view of the Proviso to Section 11AC of the Central Excise Act, 1944, and relying upon the judgment of the Hon''ble Punjab and Haryana High Court delivered on 30-4-2009 in the matter of: CCEC Rohtak v. J.R. Fabrics (P) Ltd. 2009 (238) E.L.T. 209 (P&H)

(iv) Whether there is any bounden duty under the Central Excise Law cast upon the Adjudicating Authority, to explain and/or to state with/without the note, the provisions of 1st and 2nd Proviso to Section 11AC of the said Act or to offer any specific option to any Assessee or to advise thereof to the Assessee so as to avail the same by such Assessee, in the Order-in-Original itself or through any other legitimate manner?

(v) Whether the Ld. Tribunal has committed an error in relying upon the decision of CCEC Rohtak v. J.R. Fabrics (P) Ltd., wherein the Assessee had already paid the entire duty-amount along with interest, prior to the issuance of the Order-in-Original, whereas in the present case, the Assessee had not paid the interest even within thirty days from the communication of the Order-in-Original?

(vi) Whether the Penalty imposed under Rule-25/Rule-26 of the Central Excise Rules, 2002 read with Section 11AC could be interfered with, in view of the decision of the Hon''ble Apex Court in the matter or: Union of India (UOI) and Others Vs. Dharamendra Textile Processors and Others,

This matter is called out twice, once in the 1st session and secondly in the 2nd session. Mr. Gaurang H. Bhatt, learned Standing Counsel appearing for the Revenue did not remain present on any of these two occasions nor anyone has mentioned on his behalf. We, therefore, proceed to decide the matter on merits.

Looking to the questions proposed by the Revenue, basically there are two issues for our consideration. Question Nos. 1 and 2 deal with the first issue and question Nos. 3 to 6 deal with the second issue. So far as the first issue is concerned, whether the Tribunal is right in holding that the proceedings could not be extended beyond the shortages recorded in the panchnama dated 28th September, 2002 and whether the Tribunal is justified in reducing the duty confirmed from Rs. 4,38,104/- to Rs. 3,56,023/-. The Tribunal, in its order, observed that the Commissioner (Appeals) has granted benefit to the Assessee and confirmed the duty on 7735 kgs. as reflected in the panchnama. The Tribunal concurred with the reasoning given by the Commissioner (Appeals). The Commissioner (Appeals), in his order, has observed that the panchnama dated 28th September, 2002 records the shortages of yarn to the extent of 7735 kgs. It is only at a later stage that shortages have been worked out at 9521.7 kgs. The discrepancy was in the total receipts recorded in the panchnama. Initially statement dated 28th September, 2002 admits shortages of 7735 kgs. only. The Assessee deposited the amount of Rs. 3,56,023/- being the Central Excise Duty (equal to aggregate duties of Customs) on the quantity of 7735 kgs. Subsequent statement dated 24th March, 2003 admits shortages of 9521.7 kgs. creating a discrepancy between the two statements. Corroborative statement of the receiver of the impugned goods admits receipt of 7735 kgs. only. The Commissioner (Appeals) observed that there may be an error in calculation at the time of the panchnama but the facts recorded in the panchnama cannot be corrected to the detriment of the Assessee, particularly when the Assessee had deposited the duty. The Commissioner (Appeals), therefore, took the view that the Assessee was entitled to the benefit of lower quantity recorded in the panchnama.

Since this being a finding of fact recorded by both the appellate authorities below, we are of the view that no substantial question of law arises out of the order of the Tribunal, in relation to this issue.

So far as question Nos. 3 to 6 are concerned, it is in relation to granting an option to deposit the entire dues alongwith 25% of duty demanded, interest and penalty within a period of 30 days from the date of communication of the order in appeal dated 17th March, 2009. This issue is covered by the various decisions of this Court and more particularly, the decision in the case of Commissioner of Central Excise and Customs Surat-II v. Mahalaxmi Industries 2010 (2) GLH 116 . In this case, this Court had considered the decisions of the Apex Court in Union of India (UOI) and Others Vs. Dharamendra Textile Processors and Others, and Union of India (UOI) Vs. Rajasthan Spinning and Weaving Mills,

In view of the above discussion, we are of the opinion that no question of law, much less a substantial question of law, arises out of the order of the Tribunal.

We, therefore, summarily dismiss this Tax Appeal.