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TMI Blog2013 (7) TMI 795X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Central Excise Department inspected the factory premises of the respondent company and recovered two registers and a file - Perusal of the two registers and the files revealed that the assessee was manufacturing higher counts over and above the tolerance limit in respect of the following counts declared to the department and cleared the same without payment of appropriate duty on the higher counts - Held that:- The judgment in the case of Ramalinga Choodambikai Mills Ltd [1974 (9) TMI 54 - HIGH COURT OF MADRAS], appears to be a sound view in law and obviously based on the principle enunciated under Section 114 of the Evidence Act, wherein it was held that If the department on inspection of a manufacturing premises on a particular day ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Briefly stated the facts are as follows: 4. The respondent company is engaged at least from 1985 in the business of manufacturing of various counts of cotton yarn falling under heading 52.03 of the Central Excise Tariff Act, 1985 at the relevant point of time. It appears that at the relevant point of time the rate of tax on the yarn manufactured depended on the count/finesse of the yarn. Higher the count higher the duty. On 30.08.1993, the officers of the Central Excise Department inspected the factory premises of the respondent company and recovered two registers and a file. In the show-cause notice dated 24.06.1994 issued by the department which resulted in the present litigation, the contents of the seized documents are described as u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .1,33,573/- holding that the assessee did not dispute his liability to pay higher tax on the basis of the material contained in the two registers recovered with respect to the balance of the demand based on the material contained in the FILE:- "...I find that the assessee's contention has considerable force as the count determined on the basis of test conducted on the basis of sample drawn on a particular day's production during a week cannot be the representative of the whole weeks production." 7. Aggrieved by the same, the department carried the matter in appeal before the tribunal. The tribunal vide order dated 25.06.1997 allowed the appeal and remitted the matter for afresh adjudication. 8. On such remand, the Deputy Commissioner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Madras High Court rendered in Collector of Central Excise, Coimbatore v. Cambodia Mills Ltd., 2001 (128) E.L.T. 373 (Mad.) and Superfil Products Ltd. v. CCE, Chennai. 2002 (48) R.L.T. 319 (CEGAT - Chennai), the appeal was dismissed. Whereas the decisions relied upon by the department in Ramalinga Choodambikai Mills Ltd. v. Government of India Others 1984 (15) E.L.T. 407 (Mad.), Bojaraj Textiles Mills Ltd. v. Assistant Collector of Central Excise 1990 (45) E.L.T. 559 (Mad.) and The Government of India represented by its Secretary, Ministry of Finance, Department of Revenue Insurance, New Delhi and others v. The Chirala Co-operative Spinning Mills Ltd., Chirala 1980 E.L.T. 174 (A.P.) were simply ignored. 11. In Cambodia Mills Ltd. (sup ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ory premises on the date of the drawal of the samples but also further material manufactured between the date of inspection (14.09.1966) and 20.10.1966 on which date fresh samples had again been drawn. The question was whether the demand in so far as it pertained to the yarn manufactured between the two dates of inspection solely on the basis of the test report of the samples drawn on the first date of inspection is legally tenable. The High Court held that such a demand was tenable.[ [1] Ramalinga Choodambikai Mills Ltd. Vs. Government of India and Others [1984 (15) E.L.T. 407 (Mad.). - 7. The second ground of attack is that the result of the test reports can be applied only to the quantity of yarn manufactured on the date when the sample ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tween 14-9-1966 and 20-10-1966 to produce a lesser count of yarn than the one represented by the sample taken on 14-9-1966. We are not therefore inclined to accept the petitioner's contention that the test reports cannot be taken to represent the count of yarn for the entire quantity manufactured between 14-9-1966 and 20-10-1966. ] 13. The said decision was followed in Bojaraj Textiles Mills Ltd. (supra) and The Chirala Co-operative Spinning Mills Ltd. (supra). Unfortunately, none of the above-mentioned three judgments appear to have been brought to the notice of the division bench of the Madras High Court when it considered the case of Cambodia Mills Ltd. (supra). 14. In our opinion the view taken in Ramalinga Choodambikai Mills Ltd. ( ..... X X X X Extracts X X X X X X X X Extracts X X X X
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