9911796707
TMI Blog1997 (1) TMI 156X X X X Extracts X X X X X X X X Extracts X X X X ..... eir charges against regular bills raised in this connection. Appellants claim that prior to 1983 they had been printing fabrics through Block Prints. By a Show Cause Notice dated 21-6-1985 Additional Collector called upon the appellants to show cause as to why duty amounting to Rs. 1,64,191.12 should not be levied on them for the period 22-3-1982 to 19-5-1984 and why penalty should not be imposed upon them for processing man-made fabrics falling under erstwhile Tariff Item 22(1)(b) with the aid of power and steam and for contravening various provisions of the Central Excise Act and Rules. The show cause notice alleged that the appellants had manufactured excisable goods in their factory without obtaining Central Excise Licence; that they had removed excisable goods valued at Rs. 24,87,845.82 involving Central Excise Duty amounting to Rs. 1,64,191.12 during the said period; that they had delivered excisable goods from their factory of manufacture without cover of gate passes in form GP 1 and that they had failed to account for the manufacture, storage and clearance of the excisable goods without proper account as required under the Act and Rules, thereby evading payment of Central E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the appellants during the relevant period with details of the number of sarees, the value of processed fabrics in meters and other relevant material. The show cause notice had also annexed the statements recorded from 10 of the 27 dealers. Counsel referred to the statement given by the partner of one of the dealers, viz., M/s. Hassa Ram Agencies, Delhi dated 11-2-1985, in which the said partner had stated that during the period March, 1982 to April, 1983 they had sent different types of sarees, like silk and chiffon to the appellants for printing. Counsel relied on the following statement to show that the nature of the fabrics whether it was man-made fabric or any other, was not clear from the said statement. The statement read as under : At present it is not possible for us to exactly state whether bills on which Chiffon" word only is mentioned whether the same connotes pure or artificial chiffon, but on bills where the words `semi-chiffon is mentioned we can vouch that the same pertains to artificial chiffon ." 6. Counsel drew attention to the fact that out of 35 items listed in the statement given by the partner, 5 items (Sl. Nos. 23 to 27) had been categorise ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o counsel, would show that though the boiler was actually bought by the appellants in April, 1982 installation thereof was completed much later and it had commenced working only on 22-3-1983 which has been recorded by the Inspector of Boilers in his letter. Counsel therefore, contends that there was nothing on record to show that the boiler was used by the appellants for the process of printing during the period prior to 22-3-1983. On the question of the computation of duty, Counsel contended that the show cause notice had without any basis alleged that the quantity of excisable goods was 1,76,435.17 square meters valued at Rs. 24,87,845.82 on mere conjecture since there was no evidence to show that the entire fabrics received by the appellants from various suppliers were man-made fabrics Counsel contended that the entire case of the Department was based on material which were far from conclusive on the point of the nature of the fabrics received by the appellants. The appellants had disputed the basis on which the show cause notice had been issued and the demand raised since there was no evidence to show that the appellants had been receiving the quantity of man-made fibres alle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ving regard to the statements given by the various suppliers, there could be no doubt that the description of the goods as art chiffon meant artificial fabric and therefore man-made fabric. He, therefore, stated that the contention of the appellants that the authorities should have taken the statement of all 27 suppliers or should have verified from some other sources as to whether `chiffon was man-made fabric or not was of no consequence as the statements given by the suppliers represented the understanding of the term in common commercial parlance. 8. We have considered the submissions made on both sides and perused the records. The accepted facts of the case are that the appellants had been, from 24-3-1983 using boiler generated steam for the printing of fabrics received from suppliers. It is also not in dispute that the appellants have received fabrics, namely, sarees from 27 dealers for processing. It is also on record that the appellants had processed a quantity of 1,76,435.17 square metres of fabrics during the period between 22-3-1982 and 19-5-1984. The dispute centres around three issues (a) whether the fabrics processed by the appellants were man-made fabrics; (b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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