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TMI Blog2013 (9) TMI 172X X X X Extracts X X X X X X X X Extracts X X X X ..... ar Chand Chawla for waiver of penalty of Rs.15.00 lakh imposed under Rule 26 of the Central Excise Rules, 2002. 2. At the outset, ld. Senior Advocate for the Applicants, Shri J.P. Khaitan has submitted that the Department has issued a demand for the period from April, 2004 to March, 2009, alleging removal of Rs.40,186.950 MT of finished goods valued at Rs.81,48,84,591.00, clandestinely without payment of duty. It is his contention that the allegation solely rests on the basis of the difference between the production figures in the ER-1 Returns and the production calculated from the total amount paid to the Labour Contractors engaged in the factory premises for the manufacture of all finished goods viz. TMT bar, MS round, MS ingot and coil. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... during investigation, the said Contractors were neither examined by the Department nor the explanation furnished by the Director had been rebutted by the Department either in the impugned notice or in the Order. It is his submission that in absence of any evidence in regard to the clearances of goods made from the factory, it cannot be alleged that the assumed production of goods arrived on a wrong basis, must have been cleared without payment of duty. He has submitted that though in the second Work Order, only the TMT bars and semi-finished goods were mentioned, but in fact the second Contractor was appointed to carry out the manufacturing activity of all variety of finished goods, in the factory, as no other contractor had been appointed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat any direction for pre-deposit of dues, in absence of an iota of evidence of clearance of goods without payment of duty, and only on the basis of some erroneous calculations and assumptions, would cause undue hardship to the Applicants, and the public faith on the judiciary shall be shaken. Further, he has submitted that the Steel sector as a whole is reeling under heavy recession and the Applicant are also facing severe liquidity crunch. 5. Heard both sides and perused the records. We find that the entire duty demand is based on the difference between the production shown in the ER-1 Returns and the quantity of production of finished goods, calculated by the department, on the basis of payments made to the Contractors, during the relev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... R-1 Returns and figures of production, arrived at on the basis of payments made to contractors, would not sufficient to arrive at the conclusion that the said goods were produced and cleared without payment of duty. Also, Prima facie, we find, no other corroborative evidences, like, transport documents, purchasers statements, incriminating records showing clandestine production and removals, etc. are brought to our notice by the Department, to establish the removal of 40,000 MT of finished goods valued at Rs.81 crores over a period of five years, without payment of duty. We do not agree with contention of the Ld. Spl. Counsel for the Revenue that without any corroborative evidence, the admission of payments to contractors, would lead to an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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