2011 (1) TMI 72 - AT - Central Excise

Demand of duty - deposited prior to the issue of show cause notice - grievance of the appellants is that they were not being given the opportunity to defend themselves by filing replies before the original authority as they were not given relied upon documents before decision by the adjudicating authority - appellants have since accepted that the copies of relied upon documents have been supplied to them subsequently and un-relied upon records have been released to them - set aside the order of the Commissioner (Appeals) and the order of the original authority and remand the matter to the original authority - appellants directed to co-operate in the adjudication proceedings

Summary

Issues:
1. Duty recovery and penalty imposition based on irregularly availed credit.
2. Allegation of violation of principles of natural justice.
3. Opportunity for appellants to defend themselves by filing replies.
4. Supply of relied upon documents and un-relied documents.
5. Remand of the matter to the original authority for further proceedings.

Analysis:

1. The case involved two appeals by an appellant company and the managing director against a common Order-in-Appeal. The officers found kacha slips indicating disposal of PVC resin during a visit to the factory premises. Show cause notice was issued for duty recovery and penalty imposition. The appellants did not file replies due to alleged lack of certain documents. The original authority confirmed the demand, and the Commissioner (Appeals) upheld the decision.

2. The matter was adjourned multiple times for factual clarifications regarding documents. The appellants claimed a violation of natural justice as they were not given the opportunity to address entries in the kacha slips. The appellants sought a remand to present evidence supporting the transactions mentioned in the slips.

3. The learned Advocate acknowledged the receipt of relied upon documents and release of un-relied documents subsequently. The managing director and others admitted the removal of inputs without reversing the credit. The delay in raising the issue of document supply was highlighted by the SDR, indicating an attempt to prolong the proceedings.

4. The Tribunal considered the submissions and records, noting the importance of the kacha slips and statements in the duty demand. Acknowledging the grievance of lack of opportunity to defend, the Tribunal set aside the previous orders and remanded the matter to the original authority. The appellants were directed to file replies within thirty days and cooperate in the adjudication proceedings.

5. The decision emphasized the need for a fair opportunity for the appellants to present their case. The Tribunal's order focused on ensuring a proper process with the supply of necessary documents and a reasonable timeframe for the original authority to decide the issue after hearing the appellants.