2015 (3) TMI 335 - AT - Central Excise

Waiver of pre-deposit of duty - Removal of finished goods viz. Alluminium wires from their factory without payment of duty, against various kachha challans - Applicant had disputed that the quantity reflected in the kachha challans were raw material received by them from respective raw material suppliers, for the purpose of job-work which they carried out in their premises - Held that - issues rest on evidences adduced by both sides. Also, at this stage we find that the earlier statements of the witnesses relied in the show cause notice, on cross-examination, did not conform to the earlier statements. However, also the statements of late Mr. Om Prakash Saraf and Debabrata Das are on record, whose retraction whether valid or otherwise needs to be scrutinized and examined. In these circumstances, considering the financial hardship expressed by the applicant at this stage, the offer made by the Sr. Advocate seems to be reasonable. Consequently, we direct the applicant to deposit ₹ 10.00 Lakh within eight weeks from today and on deposit of the said amount, the balance dues adjudged against M/s. Saraf Metal Works and total dues against Ms. Sumitra Saraf adjudged is waived and its recovery stayed during the pendency of the appeal. - Partial stay granted.

Summary

Issues:
Waiver of pre-deposit of duty and penalty under Rule 26 of Central Excise Rules, 2002.

Analysis:
The applications sought waiver of pre-deposit of duty and penalties totaling &8377; 1.01 Crores imposed on M/s. Saraf Metal Works and individuals. The appeal filed by one individual was abated due to his demise. The advocate for the applicants argued that in a previous round of litigation, the Tribunal had directed cross-examination of witnesses, most of whom did not confirm earlier statements. The advocate highlighted the lack of evidence supporting the allegation of clandestine removal of goods and emphasized the financial difficulties faced by the applicants. The Revenue's representative, however, asserted that there were sufficient evidences against the applicants, including statements that were allegedly retracted. After hearing both sides, the Tribunal observed that the issue revolved around the alleged removal of finished goods without duty payment, with the applicants claiming the goods were raw materials for job work. The Tribunal noted discrepancies in witness statements and directed the deposit of &8377; 10.00 Lakhs within eight weeks, waiving the remaining dues and staying recovery during the appeal's pendency.

This judgment addressed the waiver of pre-deposit of duty and penalties under Rule 26 of Central Excise Rules, 2002. The Tribunal considered the arguments presented by both parties regarding the alleged clandestine removal of goods and the discrepancies in witness statements. The Tribunal acknowledged the financial hardship expressed by the applicants and directed a partial deposit of &8377; 10.00 Lakhs, waiving the remaining dues and staying recovery during the appeal process. The decision highlighted the importance of scrutinizing evidence and considering financial circumstances in such cases.