1999 (12) TMI 643 - AT - Central Excise

Summary

Issues:
1. Duty demand on clearance of grey fabrics without proof of payment.
2. Duty demand on specific quantity of fabrics with unclear lot numbers.
3. Duty demand on unaccounted clearance of damaged fabrics.

Analysis:
1. The first issue revolves around the duty demand on the clearance of grey fabrics without proper documentation of duty payment. The appellant claimed that the fabrics were cleared after processing and were subsequently cut and packed before being cleared with duty payment. However, the Additional Collector found discrepancies in the gate passes and lot register, leading to a lack of correlation between the fabrics cleared and the gate passes. The appellant failed to provide substantial evidence to support their claim, resulting in the tribunal upholding the Additional Collector's decision.

2. The second issue concerns the duty demand on a specific quantity of fabrics with unclear lot numbers. The appellant argued that the lot numbers were inadvertently marked at the ends of the fabrics, leading to confusion during clearance. The Additional Collector rejected this explanation due to lack of substantiation. The tribunal agreed with the Additional Collector, emphasizing that even without lot numbers, correlation could have been established based on fabric composition and length. The tribunal upheld the Additional Collector's decision on this issue as well.

3. The third issue pertains to the duty demand on unaccounted clearance of damaged fabrics. The appellant claimed that the fabrics were lost or damaged during processing shortly after the factory was set up. However, the tribunal noted the absence of evidence supporting this claim, as no proof of loss or damage was presented. The Additional Collector's decision was upheld on this issue due to the lack of substantiating evidence.

In conclusion, while the tribunal set aside the order of confiscation of goods and imposition of penalty based on a relevant Delhi High Court judgment, the appeal was dismissed on all other grounds. The tribunal allowed the appeal in part, specifically regarding the confiscation and penalty, but upheld the duty demands on the clearance of fabrics due to insufficient evidence and lack of substantiation provided by the appellant.