TRIVENI GLASS LIMITED Vs. CCE

JUDGEMENT

(1.) IN these common appeals, the applicant challenges the order of the Commissioner dated 30th December 2004 confirming duty demand of Rs. 20,95,88,296/ - on the applicant in Appeal No. E/1376/05 -B and imposing a penalty of Rs. 21,95,88,296/ - on the applicant and various other amounts by way of penalty as per the order, imposed on the other applicants.

(2.) THE learned Counsel for the applicant argued all the applications together by referring to the record of stay application in Appeal No. E/1376/05 -B.

(3.) DURING the surprise visit on 16th July 1994 by the Central Excise Officers from Allahabad on the premises of M/s Triveni Sheet Glass Works Limited, the stock of excisable goods was physically checked and the statutory record scrutinized as per the rules. It was noticed that several trucks loaded with glass sheets removed from the warehouse were ready to leave the factory premises. The statutory records and other private records maintained by the warehouse section, which was responsible for dispatch of excisable goods, were checked but no details of goods loaded in the Truck No. RJ -C 6577 could be found nor was there any entry regarding clearance of these goods in the statutory records. The Excise Officers verified the stock of glass sheets stored in the godown. The assessee was having four plants in the manufacturing premises and had a separate warehouse for the glass sheets manufactured in respect of each plant. The stock of goods were taken separately in respect of the four plants and compared with the daily stock account maintained by the manufacturer, in accordance with provisions of Rule 53 of the Rules of Central Excise Rules, which revealed that glass sheets totally valued at Rs. 1,36,22,656.82 manufactured and stored in different warehouses of the respective plants had not been recorded in the statutory daily production account. The daily production reports prepared by the assessee regarding production of glass sheets manufactured on daily basis were compared with the figures reflected in the corresponding monthly returns RT -12 and the discrepancies were noticed, showing suppressed production. From the monthly report of production packing and dispatch to their Calcutta office, it was noticed that the production for the year 1993 -94 was 1,42,84,02,120.67 whereas in RT -12 returns, it was shown as 13,70,120 only revealing suppression of a quantity of 5,82,759.33 sq. mtr. on 2 mm basis. It was also found from the inter -office memos, that production as reported in respect of different plants did not match with the figures of production either given in RT -I or on DDR. A report on Physical Verification and Valuation of fixed Assets, showed the production of 1992 -93 as 1,53,35,550 sq. mtr. on 2 mm basis against the production shown on RT -12 as 1,46,77,184.55 sq. mtr. on 2 mm basis. From the monthly production/packing/despatch report prepared by the assessee for their private use, production figures as reflected on MPPDR were compared with that of RT -12 returns and suppression of a total production of 29,13,711 involving' duty of Rs. 2,50,55,816/ - was noticed. Discrepancies were also noticed from the statement sent by the assessee to the Asstt. Development Officers (Glass), Directorate General of Technical Development and the difference in sq. mtrs. between the total production and production as per the RT -12 register was 1,47,316 and 1,81,383 in April 1992, 1,56,527 sq. mtrs. in June 1992 an 1,72,672 mtrs. in July 1992. The production efficiency statements of the assessee when compared with the figures given in RT -12 returns also showed discrepancy indicating suppressed production, on 2 mm basis, to the extent of 6,46,450 in 1991, 16,837 in 1991 -92, 9,17,416 in 1992 -93 and 16,64,680 in 1993 -94. It appeared to the Department, that none of the records could be relied upon to determine the production differential to enable the Central Excise Department to raise appropriate demand, as there was not a single record, which could be relied as giving true and correct position regarding production of excisable goods, in the factory of the assessee. It also appears that the assessee had expertise to manufacture significantly higher production than the installed capacity and it was not feasible to work out the quantity of suppressed production on the basis of any single line of documents. The department therefore worked out suppressed production on the basis of the maximum production capacity. The quantity of glass sheets produced during different years were worked out on the basis of the production capacity of the plants as given by the General Manager (Technical) Shri S. Sinha, and Shri D.K. Pandey, who was the Plant Manager having 40 years of experience in manufacture of glass sheets, and compared with the production shown in the respective years on the RT -12 returns filed by the assessee from time to time. Show cause notice was accordingly issued to the assessee on 12th July 1995 to show cause as to why duty amounting to Rs. 20,95,88,296/ - should not be recovered from them under the proviso (1) to the provisions of Section 11A(1) and as to why penalties should not be imposed on them under Rule 173Q for contravening the provisions of Rule 52A, 53, 173G, 226 and 173F of the Central Excise Rules and as to why the Land, Building, Plant etc. and the truck as well as glass sheets, which were seized on 20th July 1994, should not be confiscated under Rule 173Q and penalty imposed on them. Noticee at SI. No. 2 to 17 were also required to show cause as to why penalty under Rule 209A should not be imposed on them for their conduct resulting in violation of Central Excise Law and thereby evasion of Central Excise duty.