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TMI Blog2001 (10) TMI 790X X X X Extracts X X X X X X X X Extracts X X X X ..... gs and Liniments [1989 (40) E.L.T. 276 (S.C.) = 1989 (21) ECR 182 (S.C.)] has been referred to wherein the Hon ble Supreme Court of India has made the following significant observations: In order to make the demand for excise duty sustainable beyond a period of six months and upto a period of five years under Section 11A of the CE and Salt Act, 1944, it has to be established that the excise duty had not been short levied or paid by reason of fraud or collusion of wilful misstatement or suppression of facts or contravention of any provisions of the Act or the Rules with intent to evade payment of duty, something more positive than mere inaction or failure of the part of the manufacturer or producer, deliberate withholding of information when the manufacturer knew otherwise was required before the assessee could be saddled with any liability beyond the period of six months In the case of Tamilnadu Housing Board v. CCE, Madras and Another [1994 (55) ECR 7 (S.C.)] the Hon ble Supreme Court of India observed that when the law requires an intention to evade payment of duty then it is not mere failure to pay duty but it must be something more. They further observed that the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of valuation the cost of raw materials also should be added to the job charges, they immediately took out registration and started paying duty. If they had known the real position, like other manufacturers, they would have taken Modvat credit in respect of the duty paid on the granules and would have discharged the duty liability on the polythene film. They pointed out that the Modvat credit admissible in respect of granules was more than sufficient to discharge that duty liability on the film. They, therefore, vehemently argued that there was no motive on their part to evade payment of duty. On careful consideration of the case records, I am convinced that the department has not let in any evidence to substantiate the allegations of deliberate suppression of production of value with an intent to evade payment of duty so as to invoke the proviso to sub-section (1) of Section 11A of the CE Act, 1944. As per the above cited judgments of the Hon ble Supreme Court, it is incumbent on the part of the department to bring out in clear terms intention on the part of Decent Enterprises to evade payment of duty. To substantiate the allegation of suppression of facts and misdeclaration a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Shri Babu Miya. I, therefore, propose to withdraw the proceedings initiated against them. Having regard to the facts and circumstances of the case, I pass the following order: I hereby drop the proceedings initiated against Decent Enterprises and its Managing Partner Shri Babu Miya. 2. On the basis of the above finding he has dropped the proceedings and hence this appeal has been filed by the Revenue. It is contended in the ground that they ought to have declared all the figures in the declarations filed for the years 1991-92, 1992-93 pertaining to the turnover and the value of the inputs used in the manufacture of final product namely polythene sheet and polythene film. It is stated that a statutory duty is cast upon them to furnish the figures of the value of the goods that they have declared for the preceding financial years. It is their contention that the Department had also not advised them to include the value of raw material in the furnished goods is not acceptable and this ground should not have been accepted by the ld. Commissioner and should have not allowed their appeal on time bar. It is stated that the judgment cited by him does not apply, as they could have esta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... v. Commissioner of C.E ., (Para 10) Modvat credit available even if declaration filed. 5. 1998 (102) E.L.T. 663 Agarwal Metal Industries v. Commissioner of C.E., Bangalore Modvat available if duty demanded subsequently. 6. 1995 (77) E.L.T. 511 (S.C.) Formica India Division v. Collector of Central Excise (Para 2) Proforma Credit cannot be denied on technical grounds of non-compliance. 4. We have heard Shri A. Jayachandran, DR for Revenue and Shri K.R. Natarajan, Advocate for the assessee and perused the ground made in the appeal and in the cross-objections. We have also perused all the judgments noted by the Commissioner and also relied by the assessee which is noted above. 5. On a careful perusal of the submission and the judgments, we are satisfied with the order passed by the Commissioner is correct in law in terms of ratio laid down by the Apex Court with regard to invoking of larger period. In order to upheld the charge of suppression of facts, it is to be shown by the revenue that the appellant had an intention to evade duty and that they did not hold any bonafide belief. The Commissioner has noted the Ap ..... X X X X Extracts X X X X X X X X Extracts X X X X
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