2017 (5) TMI 1012 - AT - Central Excise

100% EOU - clandestine manufacture and removal - Held that - It is not the case that adjudicating authority has turned a blind eye to the evidences brought out in investigation and reflected in the SCN - appeal dismissed - decided against Revenue.

Summary

Issues:
- Allegations of non-accountal of goods
- Allegations of undervaluation in invoices
- Reduction of demand in de novo proceedings
- Imposition of penalties on various individuals
- Appeal against the order

Allegations of Non-Accountal of Goods:
The case involved allegations against the respondent-assessee, a 100% EOU for manufacturing Acrylic Mink Blankets, of non-accountal of various goods like cut-pieces and end-pieces during the manufacturing process. The Department also accused the assessee of unaccounted production and clearance of goods, along with deliberate undervaluation of goods in their invoices. These allegations led to the issuance of show cause notices proposing a demand of differential duty, interest, confiscation of seized goods, and penalties under different provisions. The Commissioner initially confirmed these proposals in the first round of adjudication.

Reduction of Demand in De Novo Proceedings:
After the Tribunal remanded the appeal to the adjudicating authority, in de novo proceedings, the Commissioner reduced the demand of differential duty to a lesser amount along with interest and penalties on the main assessee and other individuals associated with the assessee. The penalties imposed in the de novo proceedings were lower compared to those in the initial adjudication round.

Imposition of Penalties on Various Individuals:
The adjudicating authority imposed penalties on specific individuals associated with the assessee under Rule 209A of Central Excise Rules. These penalties varied in amount and were lower than those imposed in the first round of adjudication. The penalties were justified based on the findings and evidence presented during the proceedings.

Appeal Against the Order:
The Department was dissatisfied with the adjudicating authority's decision and filed an appeal before the forum. During the hearing, the Department's representative reiterated the grounds of appeal, arguing that the authority did not properly consider the evidence presented in the show cause notices and relied heavily on the assessee's version without adequate findings on why certain evidence was not taken into account.

Conclusion:
Upon review, the forum found that the adjudicating authority had followed the Tribunal's directions in the de novo adjudication process. The authority considered the submissions of the respondent-assessee but rejected their contentions regarding the duty liability calculation and applicability of certain notifications. The forum upheld the authority's decision, stating that there was no gross infirmity in the findings and conclusions. Consequently, the department's appeal was dismissed, affirming the adjudicating authority's order.