2011 (5) TMI 514 - AT - Central Excise

Exemption Notification No.8/1997-CE denied - Demand - 100% EOU scheme - contention of the Revenue that the Commissioner has not examined the issue and has not conducted further enquiries - Held that - Commissioner has examined this issue and he has stated that he has seen the photo-copies of the invoices and copies of D-3 declaration which supports the report of the Range Supdtt. that the cotton yarn obtained and in dispute was actually duty paid - Since they had filed de-bonding application, they started receiving cotton yarn on payment of duty to be correct - Find that the Revenue has not been able to make out any case to show that the Commissioner s order is not sustainable - Decided in favour of assessee.

Issues:
1. Duty demand under exemption Notification No.8/1997-CE, dt.1.3.97.
2. Confirmation of duty demand by the Commissioner.
3. Allegations of duty evasion by the Revenue.
4. Sufficiency of evidence provided by the assessee.

Analysis:

Issue 1: Duty demand under exemption Notification No.8/1997-CE, dt.1.3.97
The case involves M/s Ashima Fabrics opting out of the 100% EOU scheme and facing a duty demand issue. The Tribunal had remanded the matter previously for fresh adjudication due to the department's proposal to reject the exemption benefit. The Commissioner confirmed a duty demand of Rs.94,242/-, which was accepted by the respondent, while setting aside the balance demand based on evidence that the cotton yarn received was duty paid.

Issue 2: Confirmation of duty demand by the Commissioner
The Revenue, in its appeal, argued that the Commissioner failed to conduct further inquiries and did not consider crucial evidence, such as the declaration filed by the appellant and the admission by the Sr. General Manager regarding obtaining cotton yarn without duty payment. However, the Commissioner examined the issue thoroughly, considering invoices, declarations, and the timing of duty payment post de-bonding application. The Commissioner's order was found to be well-reasoned and supported by the evidence presented.

Issue 3: Allegations of duty evasion by the Revenue
The Revenue contended that the Commissioner did not adequately verify duty payments on raw materials and highlighted discrepancies in the procurement process. However, the Commissioner's examination of the evidence, including invoices and declarations, supported the claim that duty paid materials were procured post de-bonding application, aligning with the department's records. The Tribunal found no grounds to challenge the Commissioner's decision.

Issue 4: Sufficiency of evidence provided by the assessee
The Revenue raised concerns about the lack of demand for inspection of registers during the original adjudication or the first round of litigation. However, the Tribunal emphasized that the focus should be on whether the Commissioner's order complied with the remand directions and was sustainable, rather than procedural aspects. The evidence presented by the assessee, including invoices and declarations, was deemed sufficient to support the claim of duty paid materials procurement.

In conclusion, the Tribunal rejected the Revenue's appeal, upholding the Commissioner's decision regarding the duty demand issue, emphasizing the thorough examination of evidence and compliance with remand directions.

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