9911796707
TMI Blog1997 (5) TMI 306X X X X Extracts X X X X X X X X Extracts X X X X ..... M.S. Flats (tension bars) and non-galvanised M.S. Flats, the Central Excise Officers found that thickness of all such selected pieces was less than 5 mm. It may be stated at this stage that it is nowhere stated - either in the seizure list, or in the statements recorded from Works Manager of the appellant - as to how many such pieces were selected and what their individual thicknesses were of each such selected piece. These Flats were formally seized on 13-9-1985. (b) Works Manager Shri Raj Kumar Raja of the respondent, in his two statements dated 5th and 6th September, 1985 submitted that the respondent is getting M.S. Flats of thicknesses exceeding 5 mm from about 20 suppliers under proper challans. Although the account of challans of each such supplier is kept separately, but the stocks of various suppliers are mixed. M.S. Flats are then cut into required lengths, as per requirement of its customers. Such cut flats are galvanised which are called tension bars in U.S.A. to which country such tension bars are exported. Minimum thickness required for such tension bars, as per American standards (ASTM), is 3/16 i.e. 4.75 mm. Therefore, they purchase M.S. Flats of exceeding 5 mm t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Rule 173Q ibid and (iv) seized M.S. Flats be not confiscated. (f) It may be noted at this stage that the seized M.S. Flats were released provisionally on 17-9-1985 to the respondent on its application. 1.2 On adjudication, the Deputy Collector of Central Excise has extended the benefit of doubt to the aforesaid three manufacturers/noticees by observing that since the respondent has been getting supplies of its M.S. Flats from 17 other persons and the stock from each such supplier is not stored separately, it cannot be stated that the seized stock of M.S. Flats (of thickness not exceeding 5 mm) at the respondent s premises has been supplied by the said three manufacturers/noticees. He, however, held the seized stock, released provisionally, is liable to confiscation under Rule 9(2) ibid. He appropriated Rs. 48,245.63 towards the amount of duty on the seized stock and Rs. 2 lakhs towards value of the goods from the amount of bond executed by the respondent for provisional release. 1.3 On appeal before the lower appellate authority, the respondent herein succeeded. That authority s findings are reproduced below :- In this connection I find that the appellant is not a manufac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2.2 Lower appellate authority s decision to release the goods on the ground that the three manufacturers charged with clandestine removal of the confiscated Flats have been exonerated does not take away the non-duty paid character of the goods in the absence of valid purchase bills for such flats forthcoming from the respondent. Presumption of duty having been paid on goods purchased from the market could arise only if the purchase bills for such goods (not exceeding 5 mm thickness) had been produced by the respondent. He further submits that case of the respondent is not that he purchased M.S. Flats of thickness not exceeding 5 mm. His case is that he purchased M.S. Flats exceeding 5 mm thickness but the actual goods found on measurement have been found to be of less than 5 mm thickness. In such circumstances, question of extending the benefit of presumption that goods purchased from the market are to be deemed to be duty paid does not arise. The goods, therefore, become liable for confiscation under Rule 2 even in the hands of the purchaser of goods, as held by high Courts of Karnataka and Andhra Pradesh respectively in the following cases :- (i) Champala Co. v. C.C. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te submits that it is now well-settled by decisions of the Tribunal that tolerance prescribed by any competent authority is to be applied for assessment of the goods. He relies for this proposition on - (i) 1984 ECR 1254 (Tribunal) Appeal against which has been dismissed by the Apex Court on the ground of time bar as reported in 1992 (62) E.L.T. A146; (ii) 1991 (53) E.L.T. 138 (Tribunal) In the first matter cited above, tolerance prescribed by ASTM was applied in respect of imported goods. The goods were reassessed as stainless steel plates instead of stainless steel sheets. In the second case tolerance prescribed by C.B.E. C. s Circular was applied to test results of a sample and assessment was changed from woollen fabric to man-made fabric. 3.3 Next submission of the learned Advocate for the respondent is that once the charge against the three manufacturers from whom the goods were alleged to have been procured by the respondent was dropped, goods namely M.S. Flats found in the possession of the respondents should be deemed to have been purchased from the market in the absence of any allegation of the goods having been purchased from any other manufacturer. He submits ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing Flats of 5 mm thickness and bills of such purchase were produced. Measurement taken by the seizing officers was not of representative samples since no record of size of the sample nor of the measurements were kept. Statement recorded about measurement becomes highly doubtful. Further, if tolerance is applied, as prescribed by ISI, the flats will be construed as of thickness exceeding 5 mm. We find a lot of force in these submissions of the learned Advocate for the respondent. A careful perusal of the statement of Works Manager Shri Raj Kumar Raja of the respondent on the subject of thickness of the seized Flats shows that he has not admitted anywhere that the samples drawn were representative of the entire lot of seized goods. He has only admitted that whatever samples were drawn at random, those samples were found to have thickness of less than 5 mm. In the absence of the size of the sample drawn and the worksheet of measurement of each piece of sample, it is extremely doubtful in the facts and circumstances of the case to place reliance on the conclusion that the seized flats are generally of thickness not exceeding 5 mm. As rightly pointed out by the learned Advocate that th ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
