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TMI Blog2012 (7) TMI 711X X X X Extracts X X X X X X X X Extracts X X X X ..... lligence (DGCEI in short), Regional Unit, Pune, it was observed that the clearance details, as per its annual balance sheet were much more than the clearance details appearing in it s central excise records. Shri Shafeeq Ahmed, Director of the unit in his statement dated 10th July, 2003 admitted the said difference and stated that the sales details as per its annual report for 1999-2000 and 2000-2001 include the sale of software designs and sale of fabrics shown by its job workers. In this connection, further investigations were taken up by the DGCEI with the customers of assessee on whose names commercial bills were raised for the sale of design software namely M/s. Bhutada Weaving Mills, Solapur, Shri Nitin Tuli, M/s. ITC-Grand Maratha Sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... igation further revealed that the assessee had taken permission from the jurisdictional central excise authorities to get the fabrics processed from various sub contractors and the said permission was granted to the assessee, subject to the condition that its processed goods should be brought back to the factory within a period of sixty days. Investigation revealed that the assessee had failed to procure its processed goods from sub-contractors within sixty days. In fact, the assessee raised the commercial invoices on sub-contractors converting its job work transactions into sale of such fabrics. After raising commercial bills on sub-contractors, assessee has booked such sales in its books of accounts. Such sale constitutes DTA sale of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e central excise records only for the purpose of projecting rosy picture of the financial position of the Company for getting more loan facilities from the bank. He also submitted that none of the persons whose statements were recorded has stated that they have purchased the goods from the appellant equivalent to the value of Rs.82,66,301/- except the evidence of clearance of goods of value of Rs.5,99,214/-. He contended that the department has failed to prove the clandestine manufacture and clearance of goods with the support of material evidence and, therefore, the allegation of clandestine removal and the consequent demand of duty cannot sustain. 6.1 In respect of demand of Rs.4,54,051/-, he submitted that the demand is entirely ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No. 2/95-CE dated 04.01.1995 is not correct. He submitted that since the goods were manufactured out of indigenously procured raw material, rate of duty applicable would be as per the Notification No. 8/1997-CE. He therefore, submitted that the duty liability requires to be re-quantified as per the Notification No.8/1997. He also submited that since there was no malafide intention on their part, there should not be any reason for imposition of penalty on the unit as well as on the Director. 7. After hearing both sides and perusing the records, we find that the demand has been raised on three issues:- 7.1 The first issue is that the assessee is alleged to have manufactured and cleared fabrics in DTA without payment of duty u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... document in terms of Section 215 of Companies Act, 1956 and their contention that the sale was shown more in the Annual Report to project rosy picture of the Company for getting more loan facilities, is not acceptable. We find that the appellants have not been able to prove their case satisfactorily that they have not cleared the goods without payment of duty. Therefore, we agree with Commissioner that the appellants have clandestinely manufactured and cleared the goods under the guise of design software. 7.2 The second issue raised in the show-cause notice that the sale value of fabrics in the year 2001-02 as per Annual Report is more by Rs.6,76,813/- than the sale value shown in excise records. We find that the balance sheet has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ading No. 63.02. The bills were never issued for yarn or any semi-finished/non-excisable goods therefore the contention of the appellants is not acceptable. There is no dispute that the goods were cleared and bills were raised for the fabrics for consideration and it was nothing but sale and, therefore, duty is required to be paid by the appellants on such sales. 7.4 In view of the above we hold that the appeals in respect of these three issues merits rejection and, accordingly, rejected. 8. Coming to limitation we find that this is a fact that appellants have not given the correct figure of production of goods in the central excise records as figures shown in balance sheets are different, therefore, extended period of limit ..... X X X X Extracts X X X X X X X X Extracts X X X X
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