2012 (6) TMI 145 - AT - Central Excise

Application for waiver of pre-deposit of duty,interest and penalty - demand is confirmed on the ground that the applicants are suppressing the value and quantity of the goods manufactured to evade payment of duty Held that - Merit in the contention of the applicant that the directions given by the Tribunal in the remand order directing that the documents asked for by the appellant shall be made available and the appellant shall file complete and proper reply to the various allegations were not complied with as the adjudicating authority on 23.3.2010 supplied copies of the documents except the document at serial No. 23 of Annexure E to the Show Cause Notice - as during the pendency of the present appeals the appellant has received all the documents the matter requires reconsideration by the adjudicating authority afresh - impugned order is set aside after waiving pre-deposit of the dues - in favour of assessee.

Summary

Issues:
Application for waiver of pre-deposit of duty, interest, and penalty; Allegations of suppressing value and quantity of goods manufactured to evade duty; Compliance with remand order; Evidence of clearing goods by suppressing value and quantity; Direction to file proper reply within two months; Non-compliance with Tribunal's directions; Waiver of pre-deposit of dues; Reconsideration by adjudicating authority; Setting aside impugned order; Directions for fresh consideration by adjudicating authority.

Analysis:
The case involved an application for waiver of pre-deposit of duty, interest, and penalty by M/s Bhagyashali Textile Mills Pvt Ltd, engaged in the manufacture of texturised polyester yarn. The demand was confirmed due to allegations of suppressing the value and quantity of goods manufactured to evade duty. The Tribunal had remanded the matter to the adjudicating authority for a fresh decision after supplying relevant documents and directing the appellant to file a reply within two months. However, the adjudicating authority passed the impugned order without waiting for the appellant's reply, leading to a violation of the Tribunal's directions and principles of natural justice.

The Revenue contended that evidence, including documentary and oral statements, supported the allegations of clearing goods by suppressing value and quantity to evade duty. The differential duty amount was confirmed based on slips recovered from the appellant's premises, showing discrepancies in the sales consideration mentioned in statutory records. The Revenue argued against a total waiver of pre-deposit of duty, citing the evidence on record.

The Tribunal found merit in the applicant's contention regarding non-compliance with its directions in the remand order. Despite the supply of most documents, the adjudicating authority did not wait for the appellant's reply before passing the impugned order. As the appellant had received all documents during the appeal's pendency, the matter required reconsideration by the adjudicating authority. The impugned order was set aside, pre-deposit of dues was waived, and the adjudicating authority was directed to decide the matter afresh, with the appellants instructed to appear with a reply to the Show Cause Notice. The adjudicating authority was directed to decide preferably within four months from the specified date.

In conclusion, the appeals were disposed of by way of remand, emphasizing the importance of compliance with Tribunal directions, principles of natural justice, and proper consideration of evidence in duty evasion cases.