1998 (6) TMI 393 - Commissioner - Central Excise

Summary

Issues:
1. Appeal against Order-in-Original
2. Application for waiver of pre-deposit under Section 35F
3. Discrepancies found during factory visit
4. Seizure of excess/unaccounted inputs and capital goods
5. Lack of show cause notice and personal hearing
6. Non-provision of relevant records to the appellant

Analysis:
1. The appeal was filed against Order-in-Original No. IV(4)10/97/P and 178/Additional Commissioner/Ind-I/CEX/97 passed by the Assistant Commissioner and Additional Commissioner, Central Excise, Indore. The appellant, a manufacturer of differential gears, challenged the discrepancies found during a factory visit, including shortages, excesses, unaccounted items, and missing records. An application for waiver of pre-deposit under Section 35F of the Central Excise Act, 1944, was also submitted by the appellant.

2. The discrepancies identified during the factory visit included shortages of differential gears, unaccounted pinions, missing drums of isopropanol and oil, among others. The excess/unaccounted inputs and capital goods were seized by central officers, leading to the adjudication under the impugned order. The appellant contended that the seized goods were duty paid, and their receipt was duly intimated to the department, as evidenced by records and acknowledgments.

3. The appellant raised concerns regarding the lack of a show cause notice, personal hearing, and access to relevant records during the adjudication process. Despite repeated reminders, copies of statements recorded under Section 14 of the Central Excise Act were not provided to the appellant. The absence of a proper opportunity for defense and the non-provision of demanded records were highlighted as violations of natural justice principles.

4. After a thorough review of the case records and submissions, the Commissioner found merit in the appellant's contentions. The Commissioner noted the failure to provide necessary documents, issue a show cause notice, or allow a personal hearing. Consequently, the cases were remanded for de novo adjudication by the adjudicating officer to ensure fair consideration of all relevant factors, including the intimation of goods and adherence to principles of natural justice.