RELIANCE INDUSTRIES LTD. Vs. CCE

JUDGEMENT

(1.) THE case is before us upon remand by the Hon'ble Supreme Court vide judgment dated 23.08.2004 in Civil Appeal No. 3226 of 1998. At issue is the duty demand of over Rs. One Crore raised on the appellant under show -cause notice dated 28/29.10.85 and confirmed in adjudication. We may reproduce the direction of the Hon'ble Supreme Court: - We find that Tribunal has not approached the controversy in the proper perspective. Various aspects which have been highlighted above and specifically noted by the collector were really not considered by the CEGAT. Its conclusion that there was no allegation of fraud, mis -declaration or intention to evade duty, prima facie do not appear to be correct. The material being wound on tubes was yarn. It did not cease to be yarn because it broke off before the required weight was achieved. It only became waste if it got entangled or messed up or if the tubes of less weight were cut. It was for the assessee to show categorically that this had happened. The log sheets deal with tubes. But without question the weight shown in the log sheets is of yarn. This prima facie indicates that tubes having yarn of less than 1 kg. are also being logged. Thus the Collector was right that the log sheets show presence of yarn on tubes, even of 1 kg. or less. The Collector had specifically noted that, if the assessee had destroyed the tubes of 1 kg. or less of POY, the reason why production was shown in the daily log sheets was not explained. Thus fresh hearing of the appeal by the CEGAT would be the appropriate course. The relevant aspects like presence of the articles in the finishing room, effect of mention in the log sheets and effect of non -maintenance of required records and the allegations contained in the show -cause notice to apply extended period of limitation must be considered in proper perspective. At the same time, if the assessee wants to place reliance on any material on record the CEGAT should also consider it.".

(2.) IN order to facilitate discussion of the issue in dispute, we may record briefly the facts leading to the present demand.

(3.) A show -cause notice dated 28/29.10.85 raised several charges against the appellant. The charge under consideration now is to be found in sub -para 4 of the show -cause notice. We may read that para: -