9911796707
TMI Blog1998 (1) TMI 124X X X X Extracts X X X X X X X X Extracts X X X X ..... ide the matter on the basis thereof as they are unable to attend the hearing personally. 3. Accordingly, we have perused the written submissions filed by the appellants and heard learned Departmental Representative and gone through the records. 4. The appellants have stated in their appeal memorandum that they are engaged in the manufacture of Acid Slurry and are holding a central excise licence. They are availing Modvat facility. Their factory was visited by the Preventive Officers and exhaustive investigation was carried on. Thereafter, the appellants received a notice which proposed to demand duty based upon allegation that two other factories namely, M/s. Ambica Traders and M/s. Shriji Sales Corporation were dummy companies and henc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ustified from the facts and circumstances of the case. The statement of Watchman was clearly not believable because the Watchman was prejudiced witness. He used to get salary/remuneration from the appellants and subsequently, the remuneration was discontinued. The Watchman clearly felt offended and was prejudiced against the appellants. Furthermore, he was attending to his duties only during night whereas the factories were taking production during day time. It is clearly established that the Watchman s statement cannot be considered as the conclusive evidence. The appellants have produced independent evidence supporting the facts that in fact, goods were manufactured at Rakhial factories. The appellants had enclosed bills of purchases of I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... E. reported in 1985 (19) E.L.T. 441 (Tribunal). 2. Pimpri Gases Others v. C.C.E. reported in 1990 (49) E.L.T. 474 (Tribunal) = 1991 (32) ECR 600 (CEGAT). 3. Swastik Engineering Works reported in 1992 (62) E.L.T. 313 (Tribunal). 4. Prabhat Dyes Chemicals reported in 1992 (62) E.L.T. 469 (Tribunal). 5. Metrosyl v. C.C.E. reported in 1995 (77) E.L.T. 130 (Tribunal) = 1995 (58) ECR 149 (Tribunal). 6. Rang Udyog v. C.C.E. reported in 1996 (83) E.L.T. 648 (Tribunal). They have submitted that only Benzene which is one of the raw material had been found stored in Shriji Chemicals wherein no other raw materials i.e. sulphuric acid, oleum etc. which were also important for manufacture of acid slurry were not found in excess or shortag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tended period as well as imposition of penalty were justified. Moreover, the Modvat claim could not be allowed by the Collector as the appellants had not applied for the quantity in question. 11. We have considered the above submissions. First and foremost, we would like to take up preliminary point regarding the validity of show cause notice in view of the amendment to Section 11A. It is true, as appellants have contended, that Section 11A, as it stood during the relevant period, required that in cases where suppression or mis-statement of fact was alleged and extended period of time was invoked on that ground, the show cause notice was required to be issued by the Collector and not by an officer other than Collector and in this case, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r knowing whether the factory was working or not; even a layman could testify and a chowkidar would apparently know and to dis-credit his statement, it was not enough to merely state that he was not paid for some time and therefore, might have nurtured some grudge. 14. Furthermore, merely because there were separate factory premises or some machinery in those factories itself is not sufficient to show that they were engaged in the production of goods. Once the Department has been able to lead evidence by virtue of the above statements, the burden shifted on to the appellants to defend themselves and to show that the three units were actually working and working independently. Once a partner says that the production was carried out at Naro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vat would only mean and imply that they would have, in the normal course, applied for Modvat (unless proved otherwise) and filed a declaration. In any eventuality, this Tribunal has repeatedly held that if benefit was due to a person under any provision, it should not be denied merely on account of some minor procedural infractions and if substantive compliance is shown, the benefit, if otherwise due, may be allowed. Therefore, insofar as Modvat aspect is concerned, the matter is required to be remanded with the direction that the Collector should check up the facts on the basis of records and allow the appellants an opportunity to show that they were entitled to the benefit and if he was satisfied about substantive compliance with the prov ..... X X X X Extracts X X X X X X X X Extracts X X X X
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