2017 (3) TMI 765 - AT - Central Excise

Clandestine removal - 5,06,762 kgs. of dyes intermediates - demand - penalty - Held that - it is settled principle of law that the evidences collected during the course of investigation whether in favour of the Revenue or otherwise ought to have been made available to the assessees and the appellant is free to make such use of such evidence in support of their case. Therefore, it is prudent to remand the matter to the adjudicating authority to decide the issue afresh - appeal allowed by way of remand.

Issues:
1. Reduction in penalty imposed on the appellant company and Director.
2. Allegations of clandestine removal of goods without payment of excise duty.
3. Non-supply of copies of statements of concerned persons to the appellant.
4. Discrepancies in computation of demand and violation of principles of natural justice.

Analysis:
1. The judgment addresses the issue of reduction in penalty imposed on the appellant company and Director. The Revenue challenged the reduction in penalty under Section 11AC of CEA, 1944. The appellant argued that evidence collected during the investigation should have been provided to them to rebut the allegations. The tribunal found merit in the appellant's contention and remanded the matter to the adjudicating authority for fresh consideration, emphasizing the need for a thorough examination of the evidence and discrepancies pointed out by the appellant.

2. The case involves allegations of clandestine removal of goods without payment of excise duty. The appellant was accused of manufacturing and clearing a significant quantity of goods clandestinely. The tribunal noted that the demand was based on records retrieved during a search conducted at the appellant's premises. The appellant raised concerns about discrepancies in the computation of the demand and highlighted that certain statements of concerned persons were not provided to them. The tribunal emphasized the importance of addressing these discrepancies and ensuring a fair adjudication process.

3. An important issue was the non-supply of copies of statements of concerned persons to the appellant. The appellant argued that copies of statements recorded by the department were not provided to them, leading to a lack of opportunity to refute the allegations. The tribunal agreed with the appellant's contention, stressing the fundamental principle of natural justice that requires all relevant evidence to be made available to the parties involved. The tribunal directed the adjudicating authority to consider all evidence, including statements of buyers, to reach a fair decision.

4. The judgment also focused on discrepancies in the computation of demand and the violation of principles of natural justice. The appellant submitted various annexures with their reply to the show cause notice, pointing out errors in the demand calculation. However, no findings were recorded on these discrepancies by the adjudicating authority or the Commissioner (Appeals). The tribunal highlighted the importance of addressing these discrepancies and ensuring a transparent and just adjudication process. The matter was remanded for a fresh decision, allowing the appellant a reasonable opportunity to present their case.

In conclusion, the judgment highlights the significance of providing all relevant evidence to parties, addressing discrepancies in demand calculations, and upholding principles of natural justice in excise duty cases. The tribunal's decision to remand the matter for re-adjudication underscores the importance of a fair and thorough examination of all aspects of the case.

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