- (1.) The Respondents herein are engaged in the manufacture of Domestic Electrical Appliances under their own Brand name 'Sunrise'. The Respondents claim that it is a Small-Scale Industrial Unit and, therefore, they have been exempted from payment of excise duty under Notification No. 13/92-CE, dated 14-5-1992. As per the declaration filed at the relevant time, the manufacturing value of the goods was less than Rs. 30 lakhs. The Officers of the Central Excise Department visited the factory premises of the Respondents on 5-12-1997 and conducted a search at their business premises as well. During that search the Officers found that apart from the Domestic Electrical Appliances manufactured under the brand name 'Sunrise', there were products of the same description lying in the premises bearing brand names 'National', 'Omega' and 'Philips' etc. Those goods were seized. The value of those branded goods was found to be Rs. 81,735/- in the factory premises and Rs. 52,120/- in the premises from where the trading activities of the Respondents are carried on. Apart from that, some loose sheets were also found and seized. On the basis of the aforesaid, immediately, show cause notice dated 23-3-1998 was served upon the Respondents alleging therein that the Respondents were manufacturing branded goods as well under the brand names 'National', 'Omega' and 'Philips' etc. and were not paying excise duty thereon. In this show cause notice, it was further alleged that as per the recovery panchnama dated 5-12-1997, which was drawn on the basis of documents seized from the manufacturing unit as well as trading premises of the Respondents, the value of the goods manufactured and cleared by the Respondents was in the sum of Rs. 1,05,32,030.00 involving Central Excise duty of Rs. 19,64,020.25. It was also stated in the show cause notice that after the seizure of the aforesaid goods, the Respondents themselves had filed declaration Under Rule 173B of the Central Excise Rules, 1944 (hereinafter referred to as the "Rules") and even paid the excise duty in the sum of Rs. 24,200/- on the value of branded goods seized from their premises. The Respondents contested the aforesaid show cause notice. The defence was that it is only a Small-Scale Industrial Unit manufacturing Domestic Electric Appliances under the brand name 'Sunrise'. Insofar as the goods with the brand names 'National', 'Omega' and 'Philips' etc. are concerned, which were recovered from the premises, the explanation given by the Respondents was that these goods were purchased from the market and sold to various customers inasmuch as, apart from the manufacturing, the Respondents were also doing trading business i.e. purchasing the goods of the aforesaid description from the market and selling the same to the prospective consumers. Regarding the declaration filed Under Rule 173B of the Rules it was explained that since the value of the goods manufactured by the Respondents was exceeding the limit of Rs. 30 lakhs, revised declaration was filed on 22-12-1997 wherein it was declared that the Respondents would be paying excise duty under Notification No. 16/97 on the goods value whereof exceeds Rs. 30 lakhs, 50 lakhs and 100 lakhs respectively. The explanation of the Respondents did not find favour with the Adjudicating Authority which passed Orders-in-Original dated 31-10-2001 confirming the duty of Rs. 19,64,020.25 and penalty of equal amount was also levied on the Respondents. The Respondents preferred appeal there-against before the Commissioner, which was dismissed by the Commissioner vide order dated 17-7-2003.
(2.) Not satisfied with the outcome of this appeal the Respondents approached the Customs, Excise and Service Tax Appellate Tribunal (hereinafter referred to as "the Tribunal"). The Tribunal has accepted the version of the Respondents and allowed the appeal in its final decision dated 13-1-2005. Against that order, present appeal is preferred by the Department.
(3.) A perusal of the order of the Tribunal would show that the Tribunal has primarily come to the conclusion, after analyzing the entire evidence, that there was no tangible evidence on record to prove the manufacture of the aforesaid branded goods by the Respondents in their factory premises. It is pointed out that the goods which were recovered and seized from the two premises, belonging to the Respondents, were hardly of Rs. 1,30,000/-. From that it could not be established that the Respondents were manufacturing these goods i.e. under the brand names 'National', 'Omega' and 'Philips' etc. Another finding of fact which was arrived at by the Tribunal is that the genuineness of the invoices, on the basis of which the demand of Rs. 19,64,020.25 of excise duty was raised, is doubtful.;