2014 (4) TMI 1129 - AT - Central Excise

Excess clearance of finished goods as per the material receipt register maintained to whom these drums were supplied - duty demand - Held that - It is the case, when the Revenue was able to prove that the appellants have cleared 10,37,048 drums to M/s. HPCL and the appellants have paid duty only on 9,02,836 drums as per GP I Gate pass. The said fact has been admitted by the appellants during the course of investigation and the same has not been retracted. In these circumstances,do not find any reason to interfere with the impugned order and the same is upheld.

Summary

Issues:
- Confirmation of demand of duty against the appellants for excess clearance of finished goods to M/s. HPCL.
- Appellants' argument regarding duty payment based on gate passes versus material receipt register of HPCL.
- Lack of cross-examination of prime witnesses and sustainability of the demand.

Analysis:
1. The judgment deals with the confirmation of a demand of duty against the appellants for the excess clearance of finished goods to M/s. HPCL during a specific period. The appellants supplied mild steel drums to HPCL on a job work basis and paid duty based on gate passes issued. However, the material receipt register of HPCL indicated a higher quantity received than the one the duty was paid for, leading to a demand of duty on the difference. The appellants admitted to this discrepancy during the investigation, and no retraction statement was filed.

2. The appellants argued that they paid duty on clearances for which gate passes were issued and questioned how the materials reached HPCL without duty payment. They also raised concerns about the lack of cross-examination of prime witnesses, contending that this rendered the demand unsustainable and called for setting aside the impugned order. However, upon consideration of the submissions and records, the judgment noted that the Revenue successfully demonstrated that the appellants had cleared a higher quantity of drums than the duty paid for, as per the material receipt register of HPCL.

3. The judgment highlighted that the appellants' admission of the discrepancy in the quantity supplied and duty paid, without any retraction, was a significant factor. As a result, the judgment upheld the impugned order confirming the demand of duty against the appellants. The lack of grounds to interfere with the order led to the dismissal of the appeals filed by the appellants, reinforcing the decision based on the evidence presented and the appellants' own admission during the investigation.

In conclusion, the judgment emphasizes the importance of accurate duty payment in line with the actual quantity of goods supplied, as evidenced by the material receipt register. The lack of retraction of the admitted facts by the appellants played a crucial role in upholding the demand of duty against them, underscoring the need for compliance with duty obligations based on factual evidence.