2019 (10) TMI 96 - AT - Central Excise

Clandestine removal - cum-duty benefit - demand mainly based on Electricity Consumption - compliance of Section 36 B (2) made for taking computer printout as evidence - principles of natural justice - HELD THAT - The Ld. Counsel has raised very important issues related to principles of natural justice in as much as whether compliance of Section 36 B (2) was made for taking computer printout, the Ld. Counsel also pointed out that the hard disk from where the computer printout was taken needs to be examined, which will show that whether the data is relevant or it is for the purpose of training as claimed by the appellant. The issue of production capacity vis a vis Electricity consumption also to be examined properly. On these issues proper consideration is required. The matter required reconsideration - matter related to assessees appeals, are remanded to the adjudicating authority for passing a fresh order. Cum-duty benefit - HELD THAT - Merely because the goods were allegedly cleared clandestinely, Section 4 cannot be applied differently - As regard the doubt raised on the valuation of the goods, we find that in one hand the show cause notice has conclusively arrived at transaction value which is final. There after no question can be raised by the revenue on the value ascertained and duty was computed on such values in the show cause notice - Therefore, the Ld. Adjudicating authority has rightly and legally extended the benefit of cum duty price which we uphold. Appeal allowed by way of remand.

Summary

Issues involved:
1. Clandestine removal of excisable goods.
2. Compliance with Section 36 B (2) of the Central Excise Act, 1944.
3. Benefit of cum duty price in cases of clandestine removal.

Analysis:

Issue 1: Clandestine removal of excisable goods

The case involved M/s. Himatsu Bimet Limited, accused of clandestine removal of excisable goods. Central excise officers conducted searches, seized incriminating documents, and found goods in excess, leading to a show cause notice (SCN) being issued. The adjudicating authority determined the duty amount not paid, imposed penalties, and issued orders against the appellants. The appellants contested the charges, arguing that the evidence, including computer printouts, was not reliable and that the data was for software training purposes only. They sought a remand for further examination. The Revenue contended that the cum duty benefit should not apply in cases of clandestine removal. The Tribunal found important issues related to natural justice and the authenticity of evidence, remanding the matter for reconsideration.

Issue 2: Compliance with Section 36 B (2) of the Central Excise Act, 1944

The appellant's counsel raised concerns about the compliance with Section 36 B (2) regarding the taking of computer printouts. They argued that the hard disk needed examination to determine the data's relevance. The issue of production capacity versus electricity consumption was also highlighted. The Tribunal acknowledged these important issues related to principles of natural justice and evidence authenticity, requiring proper consideration and a fresh order from the adjudicating authority.

Issue 3: Benefit of cum duty price in cases of clandestine removal

The Revenue challenged the extension of cum duty price benefit in cases of clandestine removal, arguing that the correct price was unknown. The Tribunal, however, upheld the adjudicating authority's decision, citing statutory provisions and previous judgments. It concluded that once the duty was computed based on transaction value in the show cause notice, the benefit of cum duty price should be extended. The Revenue's appeals were dismissed, and the parties' appeals were remanded to the Adjudicating Authority for further proceedings.

This detailed analysis of the judgment highlights the key issues, arguments presented by both parties, and the Tribunal's decision, ensuring a comprehensive understanding of the legal aspects involved in the case.