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TMI Blog2017 (1) TMI 595X X X X Extracts X X X X X X X X Extracts X X X X ..... y removed. Likewise, the input-output ratio of yarn to fabric is also asserted to be an unsubstantiated assumption. Nowhere in the records do I find any evidence to support these assumptions. Further, it was pointed out that there was an absolute absence of motive for clandestine clearance because M/s Golden Silk Mills having registered under CENVAT Credit Rules, 2002 though the manufacture of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er of Central Excise (Appeals), Thane-I, dispute the upholding of the order of the lower authority which confirmed duty liability of ₹ 54,998/- on clandestinely removed grey fabric valued at ₹ 5,49,982.97 from M/s Golden Silk Mills along with interest thereon. Further, penalty of ₹ 54,998.28 was imposed on M/s Golden Silk Mills under section11 AC of Central Excise Act, 1944 read ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce of Shri Mangilal Jain. Apparently 11kgs of yarn will yield 100 metres length of gray fabric and the shortage of yarn on the basis of the opening stock obtained from Shri Pushparaj Jain was translated into grey fabric of the value assessed in the order of original authority. Penalty was imposed on Shri Pushparaj Jain on the finding that he was responsible for the day to day functioning of the u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly goods would not be available for confiscation is to state the obvious. Availability for confiscation , confiscation and liability to confiscation are three distinct aspects; goods that are liable for confiscation should be found to be so, even in their lack, to enable the invoking of penal clause. Liability to duty does not carry with it the liability to penalty unless the conditions attac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the special measure of the option to manufacturers to pay duty on clearance of grey fabric if CENVAT credit on yarn was intended to be availed, it is contended that it would be foolish of them to contemplate clandestine removal of grey fabric which is liable to duty of 10% when duty on yarn was 24%; with such excess credit available, there is no reason for M/s Golden Silk Mills to evade duty. T ..... X X X X Extracts X X X X X X X X Extracts X X X X
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