2012 (3) TMI 436 - AT - Central Excise

Summary

Issues involved: Waiver of predeposit of duty and penalty under Section 11AC of CEA, 1944.

Details of the judgment:

1. The Applicant company was required to manufacture and supply goods to Electricity Boards as per purchase orders. The Department confirmed duty and imposed penalty based on investigations and statements obtained. The Applicant claimed goods were partly procured from traders and job workers. The Adjudicating Authority concluded that the Applicant had manufactured and supplied the goods, leading to duty confirmation and penalty imposition.

2. The Applicant's advocate argued that the goods supplied were not manufactured by the Applicant but procured from traders and job workers. They claimed violation of natural justice as certain statements were not provided to them. The advocate also highlighted that the Department failed to record statements from all suppliers and that no duty was payable as goods were procured, not manufactured by the Applicant.

3. The Department contended that the tenders and purchase orders indicated the Applicant as the manufacturer, supported by performance guarantees. They rejected the Applicant's claim of procuring goods from traders and job workers, citing discrepancies in the list of suppliers provided. The Department emphasized that witnesses denied supplying goods to the Applicant, undermining the Applicant's claims.

4. After considering both sides, the Tribunal found that the Applicant represented themselves as manufacturers in the tenders and purchase orders. The Applicant failed to provide sufficient evidence to support their claim of procuring goods from traders and job workers. The Tribunal noted the Department's reasons for denying cross-examination and directed the Applicant to deposit 25% of the duty amount within 8 weeks. Failure to comply would result in dismissal of the Appeals.

5. The Tribunal's decision aimed to balance the interests of the revenue and the Applicant, considering the principles of law and discretion under Section 35F. The waiver of duty and penalties was subject to the deposit of 25% of the duty amount within the specified timeframe, with non-compliance leading to dismissal of the Appeals. Compliance was to be reported by a specified date.