2004 (4) TMI 451 - AT - Central Excise

Summary

Issues:
1. Pre-deposit requirement of duty amount, penalty, and penalty imposed on the Managing Director.
2. Allegations of clearing goods under-valuation and clandestinely.
3. Financial hardship claimed by the appellants.
4. Opposition by the department regarding the case on merit and pre-deposit waiver.
5. Decision on pre-deposit amount and penalties, involvement of the Managing Director, and compliance deadline.

Issue 1: The appellants were required to pre-deposit a substantial duty amount, penalty under Section 11AC, and a penalty imposed on the Managing Director for the clearance of goods, including PVC pipes, which were accounted as 'PVC scrap' and allegedly removed without payment of duty.

Issue 2: The department alleged that the appellants clandestinely manufactured and removed goods, specifically PVC pipes, without paying the required duty. It was found that multiple sets of invoices were maintained, with some not containing duty payment particulars, indicating under-valuation and clandestine removal.

Issue 3: The appellants claimed financial hardship, stating that the company was closed due to financial problems, with the bank taking possession of all properties. They requested a full waiver of pre-deposit due to their inability to pay the required amount.

Issue 4: The department opposed the appellants' plea for a pre-deposit waiver, arguing that the goods were cleared clandestinely without duty payment, as evidenced by the maintained invoices and bank statements showing payment by buyers. The department emphasized the need to safeguard revenue interests.

Issue 5: After considering the facts and submissions, the Tribunal noted the prolonged adjournments taken by the appellants and the prima facie evidence of clandestine production and removal of goods without duty payment. Despite the financial difficulties claimed, the Tribunal directed the main party and the Managing Director to make specific pre-deposits within three months to avoid full waiver of disputed amounts. Non-compliance would lead to dismissal of the appeal under Section 35 F of the Act. The compliance deadline was set for 5th August 2004.