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TMI Blog2003 (3) TMI 663X X X X Extracts X X X X X X X X Extracts X X X X ..... . 3. The said demand notice was adjudicated by Additional Commissioner vide o-in-o No. 66/CEX/99, dated 31-1-1999 confirming the duty demanded and also imposing penalty under Section 11AC, interest under 11AB of the CEA 44. Personal penalties were also imposed on the co-noticees. 4. An Appeal was filed before Commissioner (A) and the same was pending at the time of filing application for Settlement on 18-12-2000. 5. In the application filed for settlement the applicant admitted a duty liability of Rs. 5,24,000/- and sought adjustment of amount of Rs. 4,00,000/- already paid by them during investigation. The applicant(s) also sought immunities u/s 32K of the CEA 44. 6. Vide Interim Order No. 3/CE/2001, dated 9-4-2001, the applications filed for settlement were allowed to be proceeded with in terms of Section 32F(1) of the CEA 44. The balance admitted amount of Rs. 1,24,000/- was paid vide TR-6 challan on 3-5-2001. 7. A report on sealed cover contents viz. Annexure was received from the jurisdictional Commissioner, Central Excise, Pune-I on 29-10-2001. 8. As per the directions of the Commission in terms of Section 32F(6) of Ihe CEA 44, Commissioner (lnv.) submitted his re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icants, M/s. Amboli Wires Pvt. Ltd., Shri Vasant Srirang Mane, Driver, M/s. Maharashtra Wire Company, Shri Surendra Bandu Jagdale, Director of M/s. Amboli Wires and Shri Vijay Pukhraj Parmar, Partner of M/s. Maharashtra Wire Company were represented by Shri A.G. Kulkarni, Chartered Accountant. Shri S.B. Jagdale, Director, also remained present. 16. The Ld. Chartered Accountant submitted that the last revised admitted duty liability of Rs. 6,10,927/- is the correct amount of duty of the applicants against the demand of Rs. 13,70,554/- raised vide Show Cause Notice dated 2-4-1998. It was further submitted that the applicants have also submitted the calculation chart vide their letter on 15-7-2002 and other circumstantial evidence such as electricity bill etc. to show as to how they have arrived at this conclusion. 17. It was submitted that the import of the Revenue dated February 2003 has been received only a few days ago. 18. Shri S.B. Jagdale informed that the raw materials M.S. Wire (lot of 80 kgs) and G.I. Wire (lot of 130 kgs) are received in coil form and which are not in a continuous running length but consist of 4, 5 or more lots of coils depending upon guage and they a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nst the proceedings before this Bench. We proceed to settle this case being more than two years old because these proceedings have not been hampered by order of any Court. 27. It is the contention of the Revenue that the applicant has clandestinely cleared manufactured goods viz. M.S. Nails and barbed wire under the guise of trading invoices of M.S. Wire and G.I. Wire. Although at the time of removal of such manufactured goods from the factory, the applicant issued hand written Invoices indicating the correct description of the goods. After the goods reached their destination, they used to tear off the said invoices and issue fresh typed invoices and the description of the goods in the fresh invoices was shown as M.S. Wire, G.I. Wire, being traded goods. The said modus operandi has been admitted by the concerned persons whose statements are relied upon in the demand notice. However, it is pertinent to note that the applicant is also engaged in genuine trading activity which fact is tacitly borne out in the statements recorded and also the invoices issued by the applicant and accepted by the Revenue while calculating the duty liability. 28. The applicant has in its submission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1995-1996, 1996-97 and 1997-98 which although have no corresponding documents co-relating them as manufactured goods but still have been accepted to be manufactured goods. Since genuine trading activity was also being under taken by the applicant which fact has been accepted by the Revenue, what remains is appreciation of available evidence. No doubt statements have evidentiary value but the statement recorded in the present case is not the only piece of evidence which the Revenue relies upon while raising the demand notice. A co-relation has been arrived with the loading book entries/delivery challans which have explicitly , indicated the nature of goods covered under the invoices issued. In respect of the ones where no such co-relation is available, Revenue seeks to rely on the very same statement to push forward their claim. This we feel is not fully justified in the facts of the case before us. Further, Revenue also relies upon a letter dated 13-3-1997 addressed to their bankers by the applicant in the context of requesting for a review of their credit limits, wherein the applicants have informed that though the audit report shows the production of barbed wire and wire nails a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e weighing 17-40 kg. This clearly indicates that the goods cleared under the guise of trading is actually manufactured goods. The segregation of manufactured invoices is done on the basis of facts mentioned above in the cases where no documentary co-relation is available. 35. We refer to the statement dated 5-2-1998 wherein Shri Surendra Bandu Jagdale, has given the following answers to the questions posed to him :- Q.10. Briefly state the process of manufacture of wire nails and barbed wire. How the machines work? A. Wire nails are manufactured from wires in machines which first forms the head, draws it to its required length and cuts it to form the point. These 3 functions are performed sequentially and continuously. The nails so formed are collected and put into the polishing barrel to remove oil. The nails are next fed in gunny bags. Barbed wire is manufactured from G.I. Wire. Two wires from separate coils are used as plys over which left and right barb is twisted. This is then wound into bundles. All these operations are carried out on one machine only. Q.13 : Please state the process of packing of wire nails and barbed wire? What packing material is used ? How m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted 3-2-2003 that they have relied upon weight system and the same holds good for all the invoices. Further, in respect of those invoices which the applicant claims are trading invoices , in none of the cases, the goods are cleared in multiple of 80 kgs or 130 kgs, instead it is cleared either in bundle/coil of 50 kg or a bundle of 17 - 40 kgs. As such, these are also manufactured goods. 40. The point sorely missed by the Revenue is that the raw materials viz. M.S. Wire and G.I. Wire which are received in form of coils are not Single coils in running lengths weighing 130 kgs or 80 kgs. As informed by the applicant during the hearing, these coils having various gauges (thickness) are received in bundles which consist of 4, 5 or more individual coils tied together by wire and the total weight is either 130 kgs or 80 kgs. Obviously, when sold/traded as M.S. Wire/G.I. Wire, the applicant is required to cut/untie these bundles and sell the same, if required according to the customers requirements. No credence is given by the Revenue to the applicants statement that M.S. Wire are sold in bundles having weight which varies from 10 kgs to 125 kgs and that G.I. Wire is sold in bundl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5,24,000/-, then revised the same to Rs. 7,06,099/- during the hearing on 18-6-2002 and later to Rs. 6,10,927/- in their submission dated 15-7-2002. The facts of the case clearly indicate that the evidences available with the Revenue are not concrete enough to demand the Central Excise duty of Rs. 13,70,554/- as has been alleged in the demand notice dated 2-4-1998. Both the applicant and the Revenue are unable to substantiate entry by entry that the invoices issued belong to either manufactured or trading activity. It is here that the applicant has come forward with a proposal of settlement and accepted Central Excise duty liability in respect of even those invoices where there are no co-relating documents available with the Revenue. The conduct of the applicant and the co-operation exhibited during the proceedings before us, we feel are justifiable enough to grant, in terms of Section 32K of the CEA 44, full waiver from imposition of penalty to all the applicants under the Central Excise Act/Rules 1944. 3. Interest: As stated above, the case is settled for Rs. 6,75,835/- and the applicant is required to pay the balance amount of Rs. 1,51,835/-. No doubt, by following the mo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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