2004 (8) TMI 572 - AT - Central Excise

Issues:
Interception of a tempo leading to allegations of duplicate consignment and duty evasion, demands of duty and penalty confirmed by Assistant Commissioner, issuance of subsequent notice for further recovery, imposition of penalties, confiscation of plant and machinery, reliance on carbon paper for altering time on documents, presumption of equivalent quantities in consignments, unaccounted manufacture and clearances, reliance on retracted statements, failure to produce Octroi payment certificate, disallowance of credit, questioning of duty paying documents and scrap receipts, invocation of penalty and confiscation provisions, and final decision on setting aside demands, penalties, and confiscation.

Interception of Tempo and Allegations:
The case involved interception of a tempo leading to allegations of a duplicate consignment and duty evasion. The Assistant Commissioner confirmed demands of duty and penalty against the assessee, its Managing Director, and the Excise executive based on statements from the tempo driver and workers of the appellants.

Subsequent Notice and Imposition of Penalties:
A subsequent notice was issued by the Commissioner for further recovery, including demands for duty, penalties under Section 11AC and Rule 57-I(4), interest under Section 11AB and Rule 57-I(5), and confiscation of plant and machinery. The Commissioner confirmed the demands, imposed penalties, and ordered confiscation, leading to the appeals.

Reliance on Carbon Paper and Time Alteration:
The Commissioner's reliance on carbon paper for altering time on documents was challenged. The carbon paper dated 17-1-1996 was used as a basis for the alteration, but it was argued that this reliance was not valid as the carbon paper was not related to the invoices in question.

Presumption of Equivalent Quantities and Unaccounted Manufacture:
The demands were based on a presumption of equivalent quantities in consignments without actual verification. The absence of excess quantity or shortages at the factory and godowns raised doubts about the accuracy of the demands, as the goods were not uniform in weight and dimensions.

Reliance on Retracted Statements and Failure to Produce Octroi Payment Certificate:
The case highlighted the reliance on retracted statements without cross-examination and the failure to produce Octroi payment certificates. The absence of material to establish the discharge of Octroi duty on Copper Scrap raised questions about the validity of the allegations.

Disallowed Credit and Questioning of Duty Paying Documents:
Efforts to disallow credit and question duty paying documents were challenged, emphasizing the lack of evidence to support the allegations. The absence of records regarding the despatch of Copper Scrap and the questioning of receipts raised doubts about the validity of the claims.

Penalties and Confiscation Provisions:
The invocation of penalty and confiscation provisions was disputed, highlighting the lack of evidence to support the penalties imposed. The absence of goods liable for confiscation led to the setting aside of penalties under Rule 209A and the confiscation of plant and machinery.

Final Decision and Setting Aside of Demands:
In the final decision, the demands of duty, denial and recovery of credit, penalties, and interest liabilities were set aside. The confiscation of plant and machinery and penalties under Rule 209A were also overturned, leading to the allowance of the appeals and the setting aside of all adverse orders.

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