2009 (7) TMI 956 - AT - Central Excise

Summary

Issues involved: Confirmation of duty demand on man-made processed fabrics based on grey challans and shrinkages, time-barred show cause notice, jurisdiction of Commissioner (Appeals), imposition of penalty equal to duty.

The judgment deals with the confirmation of duty demand amounting to Rs. 2,13,541/- on man-made processed fabrics, based on grey challans and shrinkages. The appellants did not dispute the duty demand but argued that the show cause notice was issued beyond one year from the date of search, making it time-barred. They also contended that the Commissioner (Appeals) had no jurisdiction to pass orders. Despite no appearance from the appellants during the hearing, the matter was taken for decision on merits.

Regarding the time-barred show cause notice, the appellants failed to provide justification for their claim. Statements were recorded from 15 merchant manufacturers after officers visited the appellants' unit, indicating that action was indeed taken by the department. The contention that the Commissioner (Appeals) lacked jurisdiction was not raised before the Commissioner and no supporting evidence was presented. The appellants had been offered multiple personal hearings but requested adjournments each time, leading to an ex parte decision by the Commissioner. The appellants were directed to pay interest and 25% of the duty as penalty within 30 days, as per the provisions of Section 11AC and a Delhi High Court decision. Failure to pay the interest amount within the specified time would result in an automatic increase in the penalty equal to the duty amount.

The appeal was decided in favor of confirming the duty demand and imposing the penalty as specified, with clear instructions for payment deadlines to be adhered to by the appellants.