2004 (4) TMI 220 - AT - Central Excise

Summary

Issues:
1. Imposition of penalty under 11AC for the period prior to 28-9-1996.
2. Benefit denial in respect of excisable goods sent on 'loan basis' without following Excise formalities and payment of duty.

Issue 1: Imposition of penalty under 11AC for the period prior to 28-9-1996.
The appeal arose from Order-in-Appeal Nos. 4/2002-C.E. and 5/2002-C.E. where the Commissioner (Appeals) disposed of two appeals - one by the party and the other by the Revenue. The Revenue's appeal pertained to the imposition of penalty under 11AC for the period before 28-9-1996. The Commissioner, referencing the judgment of Elgi Equipments Ltd., held that penalty for the period before 28-9-1996 was not applicable. The party, however, was aggrieved by the Commissioner's decision of not granting them the benefit regarding the clearance of excisable goods on 'loan basis' without following Excise formalities and duty payment. The Commissioner noted the lack of documentary proof regarding the return of goods sent on loan basis and rejected the plea of time bar due to the larger period being invocable and the suppression of facts by the appellants.

Issue 2: Benefit denial in respect of excisable goods sent on 'loan basis' without following Excise formalities and payment of duty.
The party submitted private registers to demonstrate the return of goods cleared on loan basis, verified by the Superintendent. The party argued that the larger period should not be invoked as the goods had been returned. However, the Revenue opposed, stating that the documents were not produced before the Commissioner (Appeals) and there was no provision in law for clearing goods on 'loan basis'. The Tribunal found merit in the Revenue's submissions, emphasizing that the party failed to provide invoices or gate passes to prove clearances under loan basis. The private registers maintained by the party were deemed insufficient as statutory registers under the law. The Tribunal concluded that clearances made without duty payment could not be considered as clearances on 'loan basis', as there was no provision in law for such clearances. The appeal was rejected, upholding the Commissioner's order.

In conclusion, the Tribunal upheld the decision of the Commissioner in denying the benefit to the party for the excisable goods sent on 'loan basis' without following Excise formalities and payment of duty. The lack of proper documentation and failure to adhere to statutory requirements led to the rejection of the appeal, with the Tribunal finding no merit in the party's arguments.