9911796707
TMI Blog1996 (5) TMI 124X X X X Extracts X X X X X X X X Extracts X X X X ..... he value of clearance of goods as Rs. 4,86,163.25 and had stated that as per their estimate goods of value about Rs. 12 lakhs would be cleared during the year 1988-89. On 12-5-1989 appellants obtained Central Excise Licence on reaching the limit of Rs. 10 lakhs value of clearance which brought them under licensing control. They also paid duty of Rs. 805.35 on the value of clearance Rs. 15,340.25 in excess of the exemption limit of Rs. 15 lakhs. These details of value of clearance tallied with the information supplied by the appellants to the Sales Tax Department also. The Central Excise Officers however found on verification of the sales figures furnished by the appellants to the District Industries Centre, Patiala, that the appellants in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds were coal and fireclay. It was stated that for producing 150 M.T. of refractory goods 60 to 65 MT of coal, costing about Rs. 60,000/- is required, fireclay about 175 MT costing Rs. 25,000/- is required besides labour and miscellaneous expenses. It was further stated that the actual sales figures are the same which had been supplied to the Income-tax, Sales-tax and Central Excise Departments. Show cause notice was accordingly issued on 2-8-1991 and in reply it was inter alia contended that the show cause notice simply proceeds on the basis of returns filed with the Department of Industries which cannot be preferred to the data contained in Central Excise statutory records. The figures given by C.D. Singla had not been shown to be incorrec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e years 1987-88 and 1988-89 upto 31-8-1988 with a supporting affidavit. On this basis the charge of clandestine removal is made and the demand for duty has been worked out. But the learned Counsel for the appellants has cited and relied upon the Tribunal decision in the case of Punjab Oil Silicate Mills v. Collector of Central Excise, reported in 1993 (65) E.L.T. 268 (Tribunal) in support of the argument that the appellants had submitted inflated sales figures to the Industries Department in order to obtain higher quota of the scarce raw material, coal, and that the Department cannot rest its case solely on that inflated declaration without any other corroborative evidence of manufacture and removals. In that decision, it is seen, the iss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e other authority in different context for different purpose cannot be taken as conclusive proof in the absence of positive evidence adduced by the Department. At best it may be an inference but not substantial proof. Further this aspect was not considered by the original authority. Under taxing statute while concluding best judgment assessment it should be based upon facts and circumstances found by the assessing authority himself and he is not entitled to act wholly on the basis of the report made by the other authorities or an admission made by the party before the other authorities. In the facts and circumstances of the case and taking into consideration the ratio of the decisions cited (supra), we hold that the department was not justi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oduct ratio during the relevant period. Such a study was also called for as it was not a case of interception of the consignment while being clandestinely removed, and also because of the appellants consistent claim that their declaration before Department of Industries contains of inflated figures to obtain higher quota of coal which was a [scarce] raw material. As has been observed by the Madras High Court in the case of State of Tamil Nadu v. India Crafts Industries - 1970 25 STC 466 quoted in the Tribunal decision (supra), merely because the assessee conducted himself in a manner which was not conducive to ethics, the taxing authority could not invoke the provisions of reassessment and penalise him. The morality and intention of an as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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