2008 (9) TMI 729 - AT - Central Excise

Summary

Issues involved: Application for waiver of pre-deposit of duty and penalties u/s 35F of the Central Excise Act, 1944.

The judgment pertains to applications filed for waiver of pre-deposit of duty and penalties amounting to Rs. 3,62,31,930/- by the applicants engaged in the manufacture of branded Gutka. The Revenue alleged that the goods were cleared without payment of duty and sent to various places under fictitious names, based on entries in private records and railway receipts seized during searches. The applicants cited a Tribunal decision in a similar case to support their contention that reliance on booking clerk and booking agent evidence does not warrant confirmation of demand. Additionally, they raised objections regarding the recording of statements of witnesses after the issuance of show cause notice without addendum and the reliance on production capacity evidence without providing copies of relevant panchnamas.

The Tribunal noted discrepancies in the evidence presented by the Revenue, such as the absence of consignee details in records recovered from the booking agent's premises and the lack of panchnama copies supplied to the applicants for verification. It was observed that statements of witnesses and the proprietor were recorded post the show cause notice issuance, and the Adjudicating authority relied on these statements. Drawing parallels with a previous Tribunal decision, the Tribunal found merit in the applicants' contentions and consequently waived the pre-deposit of duty and penalties, allowing the stay petitions. The Revenue was granted the liberty to refer to a pending High Court decision in a related case for further action.