Decided on January 14,2015



Manmohan Singh, Member (T) - (1.)THERE are four appeals arising out of a common Order under which the learned Commissioner of Central Excise Lucknow has demanded Central Excise duty amounting to Rs. 19,77,133/ - from M/s. Portland Cement (I) Ltd. (Appellant No. 1) and duty Rs. 1,89,280/ - from M/s. Portland Chemicals (Appellant No. 2) besides imposing the penalties of equal amount on both the Appellants respectively. Adjudicating Authority also confiscated 1210 bags of cement valued at Rs. 1,21,000/ - with an option to redeem the same on payment of Rs. 3,700/ - for 369 bags to the Appellant No. 1 and fine of Rs. 8,400/ - for 841 bags to the Appellant No. 2. The Commissioner also confiscated 1962 empty bags valued at Rs. 11,572/ - with an option to redeem the same on payment of fine of Rs. 1,100/ - to the Appellant No. 1. A penalty of Rs. 2,50,000/ - was imposed on Shri S.P. Agrawal, Director of Appellant No. 1 and a penalty of Rs. 50,000/ - was imposed on Shri B.P. Agrawal, Partner of the Appellant No. 2 under Rule 209A of the erstwhile Central Excise Rules, 1944.
(2.)SINCE all the four appeals arise out of a Common Adjudication Order, all the appeals are taken simultaneously for the decision.
Facts are recapitulated to appreciate the issued. The Central excise Officers Division, Aligarh visited the factory premises of Appellants No. 1 and 2 on 21.03.1997 and detained 1210 bags of cement as the same were not accounted for in RG -1 Registers, along with empty bags. The detained bags were finally seized on 22.05.1997. The Central Excise officers had also resumed certain records which included loose papers also. The demand of duty Rs. 1,89,280/ - has been confirmed on the basis of some of the loose papers and the duty Rs. 19,77,133/ -has been confirmed on the basis of the meter reading of DG sets installed in the factory premises as shown in loose papers.

(3.)THE learned Advocate Shri Bipin Garg submitted that there was no evidence of clandestine clearance of goods by both the Appellants Nos. 1 and 2 and the entire case was based upon presumptions. The learned Advocate also mentioned that the duty has been demanded in respect of 11,414 bags of cement on the basis of loose sheets. He has submitted that these sheets neither bear the name of the company nor the names of the factory nor the description of the commodity. He contended that in absence of these details, it could not be presumed that the loose sheets pertained to Appellants and were in connection with the production and clearance of cement. The learned Commissioner has presumed without any evidence that these sheets pertained to cement bags since in a cement factory, bags produced would be of cement. He placed reliance on the judgment in the case of Oudh Sugar Mills v. Union of India,, 1978 (2) ELT (J172) (SC) wherein the Supreme Court has held that a finding based only on inferences involving unwarranted assumptions was vitiated by error of law. The learned Advocate further contended that the learned Commissioner has accepted that the said sheets were prepared by the labour contractor. He further contended that slips pertaining to removals and statements of witnesses were not sufficient to establish clandestine removal based on the decision in the case of Essvee Polymers (P) Ltd. v. CCE,, 2004 (61) RLT 918 (CESTAT -CHE). He further referred that RUD H -1 was unsigned, the learned Commissioner has relied upon it by stating that these unsigned sheets are reflection of unrecorded production and clandestine clearance. Fact can not be proved merely on presumption and assumption. In the case of Forge Pvt. Ltd. v. CCE, : 2005 (179) ELT 336, the Tribunal has held that without clarity to its author and obtaining their version as to what and why he recorded therein, would be in the realm of assumption and presumption and no reliance could be placed upon the same.

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