9911796707
TMI Blog2000 (8) TMI 345X X X X Extracts X X X X X X X X Extracts X X X X ..... Limited are engaged in the manufacture of Rigid PVC pipes. They were taking Modvat credit on the inputs like PVC resin, calcium carbonate and chemicals. The Central Excise Officers visited the factory of the appellants on 2-1-1996. The records were not available in the factory as they were reported to be lying in the registered office of the company. On physical verification of the stock of the finished goods as well as the raw materials, there were excesses and therefore the excesses were seized. Some PVC pipes were also found short. Since the appellants could not provide satisfactory explanation for shortage of the PVC pipes, it was alleged that these PVC pipes involving central excise duty of Rs. 1,92,478/- were removed clandestinely. 4. On the basis of RG 1 register and the actual production shown in the private records, it was alleged that during the period 10-3-1995 to 31-12-1995 (excluding August, 1995 for which private production records were not available), the total production recorded by the appellants in the RG 1 register was only 50,250 pipes whereas the actual production as per the private records was 93,815 pipes. It was therefore alleged that the appellants suppre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... heir respective recorded balances whereas the pipes of 10 varieties were found to be short compared to their respective recorded balance. Similarly, raw materials like PVC resin was found to be short whereas the calcium carbonate and other misc. chemicals were found to be in excess which were seized. 7. Detailed investigation revealed that more than one private record is available for some periods and the factory was running in three shifts. In every shift there is one machine operator supervising the functioning of these machines. He takes different raw materials as per requirement, enters their quantities in the aforesaid private records. The number of pipes manufactured in that shift on each of the three machines is entered by the operator in the private records. This fact according to the SCN is confirmed in the statement of Shri K.K. Gupta, Supervisor and Shri Suresh Chandra Yadav, Machine Operator. Every machine operator and supervisor was supposed to calculate the varieties of calculation and the raw materials issued in the previous three shifts and on this basis the entries in RG 1 and in RG 23A Part I are supposed to be made. Scrutiny of these private records revealed th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for every 128 kgs of recorded production, the appellant appears to have suppressed 40 kgs of production. Applying this ratio, it was alleged that the appellant had suppressed the production of rigid pipes valued at Rs. 1,54,55, 123/- involving central excise duty of Rs. 30,91,025/- during the period 1-4-1994 to 9-3-1995 and August, 1995. 10. Arguing the case for the applicants, Shri A.K. Jain, ld. Advocate submits that the order is violative of the principles of natural justice inasmuch as a copy of the letter of Joint Director of BIS, New Delhi was not supplied and that the request for cross-examination was not considered; that the department has relied upon the certain records alleged to be maintained by the appellants. He submits that the handwriting expert clearly indicated that the handwriting in these books was not of the same persons but was the different persons. He submits that these records were not being maintained under any authority of the management. Thus the records maintained, if any, by the staff cannot be relied upon. The main thrust of the arguments of the counsel was on the use of 60 parts of calcium carbonate with 100 parts of PVC resin. He submits that he h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not relied upon the diary and notebook but has gone by additional use of calcium carbonate. He also submits that BIS certificate nowhere stated that the PVC pipes of ISI specification 4985 can be manufactured by using more than 20 parts of calcium carbonate. He submits that this letter was never given to them. He submits that the demand was time-barred inasmuch as there is no evidence of intent of evading duty. He submits that in the recent 5 Members judgment in the case of Jay v. Yuhshin Limited [2000 (119) E.L.T. 718 (T) = 2000 (39) RLT 501], this Tribunal held that inasmuch as Modvat credit in RG 23A Part II was available to the appellants to cover alleged clandestine clearance without any further duty liability from PLA, the intention to evade duty did not arise. 11. Ld. Counsel also submits that Shri J.K. Agarwal never accepted that diary/notebooks were correct. He submits that no single invoice was found in the search evidencing any clandestine removal. He submits that in the order-in-original, penalties were not imposed on S/Shri T.R. Jain and K.K. Gupta and that the penalties should not be imposed on de novo adjudication. He, therefore submits that since the department h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -3-1995 to 31-12-1995 except August, 1995. This demand has been computed based on the private records diary and notebooks maintained shift-wise, the department went to the extent of calculating the size-wise and date-wise production based on these diaries/records. The department has at no stage held that they are not relying on the diaries maintained shift-wise only. In passing they have said that this also supports the contention that the diaries show that 60 parts of calcium carbonate was being used. Since this demand is based on the private records maintained by the assessee, we uphold this demand of Rs. 24,49,083/- for the period 10-3-1995 to 31-12-1995 except August, 1995. We also note that private records were not given a go-bye. 16. Insofar as the demand of Rs. 30,91,025/- for the period April, 1994 to March, 1995 and August, 1995 is concerned. We find that the appellants produced the evidence in the form of inspection report by CIPET itself an apex agency in the particular field. We also note that the department is contending that the applicants produced more pipes. However, we note that it is indicated nowhere that 60 parts of calcium carbonate will increase the length o ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
