2009 (3) TMI 759 - AT - Central Excise

Tribunal waives pre-deposit duty & penalty requirement, finds no evidence of manufacturing capacity.

The Tribunal waived the pre-deposit requirement of duty and penalty for the appellants in a case involving the capacity to manufacture angles and ... Demand - Dealer Issues:1. Waiver of pre-deposit of duty and penalty.2. Capacity of the appellants to manufacture angles and channels.3. Evidence of purchase of goods in question.Analysis:1. The appellants filed applications for waiver of pre-deposit of duty and penalty following a remand order by the Tribunal. The Tribunal directed the lower authority to provide an opportunity for the appellants to present purchase/duty paying documents for M.S. Angles and Channels. The appellants submitted necessary documents to support their claim of trading in these items, but the claim was rejected, alleging that the goods were manufactured by the appellants and cleared without duty payment.2. The appellants argued that there was no evidence to prove they manufactured the goods in question, as they lacked the necessary manufacturing facilities like rolling mills. They presented purchase documents that were rejected for being illegible, although they contended otherwise. The documents included details of the dealer from whom the goods were purchased, but no verification was conducted by the Revenue. The Revenue insisted that the appellants needed to prove the purchase, which they allegedly failed to do.3. The Tribunal found no evidence of the appellants' capacity to manufacture angles and channels. The appellants maintained that they purchased and resold the goods, providing documents with dealer details. However, no verification was carried out by the Revenue. Due to the absence of proof regarding the appellants' manufacturing capacity, the Tribunal waived the pre-deposit requirement of duty and penalty, setting aside the impugned order and allowing both appeals. The decision was dictated and pronounced in open court.